10:59 AM EDT, 03/22/2024 (MT Newswires) -- FedEx ( FDX ) fiscal Q3 earnings surpassed expectations due to Express' operating income benefiting from lower-than-expected incentive compensation accrual and effective capacity utilization in ground and freight networks to mitigate the impact of Memphis snowstorms, UBS said in a note Friday.

Express is set up for significant margin improvement in fiscal 2025 as it overcomes headwinds from lower international yields and reduced postal service activity, according to the note.

UBS said it expects FedEx ( FDX ) to benefit from tailwinds due to general and administrative savings and Europe business enhancements, despite uncertainties in inflation and demand.

The investment firm increased the price target on FedEx ( FDX ) shares to $340 from $323 and reiterated its Buy rating.

The company shares were up 8% in recent trading.

Price: 286.90, Change: +22.04, Percent Change: +8.32