FedEx Delivers The Bacon

news for the number two package delivery company today
, as
the FedEx
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announced its second-quarter
earnings will be 10 cents above Street estimates. That news has been good enough
to keep both FDX and
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trading in positive territory despite the full-bodied
profit-taking session that has pushed the DOW down 172 points (as of 10:30 am

regular readers of this column already know, we predicted the package delivery
companies would have a far easier time of it post Sept. 11
than their related passenger air carriers. Our reasons for that were twofold: 1)
the extra security measures wouldn’t substantively affect their business, and 2)
packages wouldn’t have the same trepidation about flying than their
flesh-and-blood counterparts might. Additionally, the Air Transportation Safety
and System Stabilization Act, which doled-out $5 billion in direct aid and $10
billion in guarantees, were obviously extremely well-timed and contributed
greatly to today’s positive announcement.

However, it was not merely that $101 million from the government that helped FDX
put up these impressive numbers. FedEx Ground, its direct shot at UPS and some
outstanding cost management, are why the package delivery giant has recovered so
robustly from the low $30s.