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FedEx stock rises on strong guidance, Blackberry shares pop, cruise line stocks soar into summer

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FedEx shares are up after reporting stronger-than-expected guidance, Blackberry stock rises after a promising software outlook, and cruise line stocks are up ahead of the summer travel season.

Video transcript

RACHELLE AKUFFO: Everyone, it is time for "Triple Play," and my pick to kick us off is Blackberry. ticker symbol BB. Now Blackberry's earnings loss was less than expected so some good news there. Blackberry's CEO, John Chen, said that he expects revenue growth to stay between 8 and 12%, in line with the fiscal year of 2022.

Now, obviously originally known for its phones, its shift into the cybersecurity space and the internet of things is really where the growth is. It's also the market leader in safety certified embedded software in cars. So you've got Blackberry with you, you just might not know it. Now Blackberry QNX software is now embedded in over 215 million vehicles worldwide, and that's 20 million more than last year. Among them, BMW, Honda, Mercedes-Benz, and Toyota.

Now regarding car software and cybersecurity, Chen said, given its exciting market opportunities and synergies as the two markets continue to converge, the company is well positioned to invest and drive growth. So new life there continuing.

EMILY MCCORMICK: Well, new life there continuing, and new life also for the stock. If we take a look at shares of Blackberry, of course, it's both a software player, a growth player, and technology player. But also a meme stock, so we are seeing a rebound here in some of these riskier assets today. We're seeing that when we look at the NASDAQ Composite, and certainly seeing that when we look at shares of Blackberry as well. Up nearly 7% on an intraday basis.

But shifting gears here, my "Triple Play" pick is FedEx. Now shares of this company are also climbing after some better than expected results posted yesterday afternoon. The company delivered a full year profit forecast that exceeded Wall Street's estimates, signaling it's still maintaining pricing power for now, even amid inflation.

Now FedEx sees full year adjusted earnings per share coming in between $22.50 and $24.50, which was better than what Wall Street analysts were looking for. However, FedEx did signal that it's baking in expectations for a bit of a slowdown in its business-to-consumer shipping volumes into its forecast for next year. Now, specifically FedEx Chief Customer Officer, Brie Carere, said yesterday that FedEx sees consumer spending, quote, tilting towards services from goods.

So, guys, I think this is really an extension of this shift we're seeing in the economy. This shift in consumers really having to prioritize their spending here. And right now, it really is these reopening categories that consumers are a little bit more willing to spend on now. But again, we'll see how much these discretionary purchases actually continue as we have inflation continuing as well.

- Yeah, you nailed it there. We talked to analyst John Eade yesterday. I believe that was guys that spoke with him, who said primarily he's seeing their ability to pass on the high cost of fuel to consumers, which has been a huge win for them and their partnerships with major corporations around the globe. The two wins that really stood out to him from their earnings. And how about their new CEO? Raj Subramaniam, feather in his cap, taking over for Fred Smith.

RACHELLE AKUFFO: I do just want to add, though. When you think of FedEx, it really is a bellwether company, in terms of, if people are shopping, more packages. If you think of how logistics is doing, that's also FedEx. If you think of how retailers are doing-- so it really does tap into all these things. So it's-- FedEx is a really important one to watch.

- Well, that's why we're seeing a bit of a slowdown, right? In Europe and China, as well in terms of the packages. So yes, a very good barometer. My play, three of the biggest winners on the S&P to end this week, the big three cruise lines all big gains today, led by Royal Caribbean. Carnival today reported earnings. Revenue increased by nearly 50%. Booking volumes, though, the key for all future sailings during the second quarter of '22 were nearly double the booking volumes during the first quarter. The company notes these were its best quarterly bookings volume since the beginning of the pandemic.

On future guidance, Carnival, a big day. And here are the gains for the big three on the afternoon. Well, I just lost them here, but let me see if I can get them on the screen. Carnival, about 11-point gain. Royal Caribbean and Norwegian up about 15%. People thought that people were not going to get back on cruise ships because of COVID. It appears we will.

RACHELLE AKUFFO: That's interesting. I thought they were flailing at one point, and now it seems people are back in the mix again.

- They were in big trouble for quite some time. But the last couple of weeks, it seems the sentiment has turned.

EMILY MCCORMICK: Well, and I think a big thing for the cruise stocks, too, as well as if we look at the airlines, if we look at a lot of the cyclical names today, we really are seeing a rebound just in sort of investor sentiment, I think, when it comes to these, because we're also seeing crude oil prices moving lower because of some of these recession concerns. And yet at the same time, of course, that is something that would benefit a lot of these travel stocks.

But again, I think sentiment moving to the upside today, we're seeing the three major indices moving higher, and seeing again a rebound across cyclical names, which include these cruise lines.

- And you can still get sales, because you get on all three websites between 30 and 45% off. So if you do have some travel openings for the summer, check out a cruise. Do you still have a Blackberry? Be honest.

RACHELLE AKUFFO: You know--

- I was hoping you'd have one here for your "Triple Play."

RACHELLE AKUFFO: I have one for the nostalgia. I still have a Blackberry. I have a T-Mobile Sidekick. I still have a-- I have a beeper still from way back. So one day when I open a museum, you're all invited. I'm keeping all my tech.

- The Rachelle Akuffo Technology Museum. Look forward to that opening.

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