Factors such as leverage, emerging market growth, and the consumer shift to e-commerce will keep FedEx going strong for the next few years, says transportation services analyst for Morgan Keegan, Arthur Hatfield.
Hatfield's comparison to competitor United Parcel Service, which is also performing well during the holiday shipping season, shows why FedEx might remain on top.
"Fedex has a little more leverage into a recovery than UPS, so we should see a much bigger step up in earnings over the next couple years, and as such the stock should outperform," he said.
FedEx delivered its second-quarter earnings report Thursday, beating estimates and reporting 10 percent revenue growth to 10.6 billion dollars.
The company's shares were last up more than 6 percent in afternoon trading.
Hatfield forecasts that future growth for the logisitics services company will come from international domestic networks, moreso than the U.S., which he said is "already a mature market."
U.S. domestic revenue for FedEx currently represents less than 10 percent in total revenues.
In the swing of holiday shipping season, Hatfield says online orders are driving the U.S. domestic business.
Customers moving away from brick-and-mortar stores, and moving towards e-commerce is "definitely benefitting" FedEx, he added.
Additional News: US Postal Service Postpones Closings
CNBC Data Pages:
An affiliate of Morgan Keegan received compensation for products or services other than investment banking from FedEx in the past 12 months.
Arthur Hatfield, as per Morgan Keegan policy, does not own the stock in the companies he covers.