I'm cautiously optimistic about FedEx's future, says Jim Cramer

Core Viewpoint - FedEx reported a significantly better-than-expected quarterly performance, leading to a stock price increase of over 2% despite previous struggles and negative market sentiment [1][2][4]. Financial Performance - The company experienced a nearly 20% decline in stock value for the year prior to the earnings report [2]. - FedEx's revenue beat expectations, driven by a 4% year-over-year increase in its core FedEx Express business, while earnings per share reached $3.83, surpassing Wall Street's expectation of $3.61, indicating a 6% growth [4][5]. - FedEx provided its first full-year forecast for the 2026 fiscal year, projecting 4% to 6% revenue growth, significantly higher than the analyst expectation of 1.1% [5]. Management Insights - Management expressed a more positive outlook on the operating environment, describing it as "dynamic," acknowledging challenges from a weak industrial economy and tariffs [6]. - The CEO highlighted the importance of customer service and the company's ability to adapt to changes in tariff regulations, particularly the removal of the dimminimous tariff exemption [8][9]. Market Position and Strategy - FedEx is gaining market share, particularly at the expense of UPS, by focusing on improved service rather than just price cuts [10][19]. - The company is implementing cost management initiatives, such as the "Network 2.0" project aimed at enhancing efficiency in its North American operations without compromising customer satisfaction [12][14]. - FedEx's "triolricolor strategy" focuses on increasing delivery speeds and profitability in its air freight business by optimizing capacity based on demand [16][17]. Future Outlook - The company is cautiously optimistic about its ability to navigate the current economic landscape while maintaining customer satisfaction and market share [19]. - FedEx's stock is considered undervalued, trading at less than 13 times the midpoint of its full-year earnings forecast, compared to the market average of 25 times earnings [20].