FDX
FedEx Corporation$386.56
Sell
Target $323.93
Report: Feb 25, 2026Industrials • Integrated Freight & Logistics • Asset-Based OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$386.56-16.2%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$323.93
(16% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$392.86
52 Week Low$194.30
Avg. 3 Month Volume1.97M
Efficiency
LTM Gross Margin62.6%
LTM EBITDA Margin12.1%
LTM EBIT Margin7.4%
LTM Operating Margin6.2%
LTM ROA5.0%
LTM ROE15.8%
LTM ROIC6.9%
LTM ROCE9.3%
Capital Structure
Market Cap (MM)$85.0B
Enterprise Value (MM)$115.3B
Shares Outstanding238.61M
Total Debt (MM)$42.02B
Cash & Equivalents (MM)$11.69B
LTM Net Debt (MM)$30.33B
LTM Net Debt/EBITDA2.7x
Growth
TTM Rev. Growth4.7%
Last 3-Yr Rev. CAGR-0.2%
Last 3-Yr EBITDA CAGR8.8%
Last 3-Yr EPS CAGR17.3%
Valuation
Street Target Price$358.06
LTM EV/Revenue1.3x
LTM EV/Gross Profit2.0x
LTM EV/EBIT17.0x
LTM EV/EBITDA10.4x
LTM P/E19.0x
LTM EV/FCF26.4x
LTM P/FCF19.4x
LTM P/TB1.0x
LTM P/B2.9x
Dividend Yield2.0%
Payout Ratio38.4%
Executive SummarySituation: Current price is $386.56 versus fair value $323.93 (-16.2% expected return), and valuation confidence is stable. Debate: Bull case depends on FedEx Freight Spin-off This is the primary event expected to unlock value by separating the high-margin LTL business from the lower-margin parcel network. Bear case centers on Global Trade Policy and De Minimis Changes Changes to trade exemptions could permanently impair the 1 billion in transpacific revenue that FedEx relies on for high-margin international export. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
The spin-off of FedEx Freight could unlock 30 billion to 35 billion in equity value, while the DRIVE program is on track to deliver 4 billion in structural cost savings by FY2027. Furthermore, the transition to a unified One FedEx network is expected to significantly improve asset utilization and reduce capital intensity.
Bear Case
Eroding asset efficiency is evidenced by a negative incremental ROIC of -93.7% and a TTM ROIC of 4.5% that sits well below the cost of capital. Additionally, the loss of the USPS contract and persistent trade headwinds in the China-U.S. lane create a 1.5 billion annual revenue and margin drag that cost-savings initiatives are failing to fully offset.
Key Catalysts
Mid-Term (6-18 months)Impact: Critical
FedEx Freight Spin-off This is the primary event expected to unlock value by separating the high-margin LTL business from the lower-margin p...
Near-Term (0-6 months)Impact: High
DRIVE Program Savings Realization The achievement of the final 1 billion in permanent cost reductions is necessary to prove that the One Fed...
Long-Term (18+ months)Impact: Moderate
FedEx is at a critical juncture as it prepares for the June 2026 spin-off, making the next 12 months the definitive period for assessing whe...
Primary Risks
Concern: High
Global Trade Policy and De Minimis Changes Changes to trade exemptions could permanently impair the 1 billion in transpacific revenue that F...
Concern: Medium
Asset Obsolescence and Grounding Costs The grounding of the MD-11 fleet and the aging of narrow-body aircraft require significant maintenanc...
Concern: Medium
The governance environment is currently in a state of transition due to the upcoming spin-off. We outline the following Governance Outcome T...
Recent Activity
2026-02-03Analyst Target
+5.41%Firm: Bernstein Price Target: $427.00 Price When Posted: $335.30 Implied Upside: +27.3%
2025-03-21SEC Filing (8-K)
-6.45%Excerpt: (EX-99.1) EX-99.1 Exhibit 99.1 Fed Ex Reports Third Quarter Diluted EPS of $3.76 and Adjusted Diluted EPS of $4.51 Delivered Revenue, Operating Income, and EPS Growth Completed $500 Million Share Repurchases During Quarter Revises...
2024-09-20SEC Filing (8-K)
-15.23%FedEx reports Q1 FY2025 results with revenue decline and DRIVE program progress
2024-06-26SEC Filing (8-K)
+15.53%FedEx reports fiscal 2024 results with adjusted EPS of $17.80 and introduces $2.2B DRIVE cost savings program
2024-03-22SEC Filing (8-K)
+7.35%Excerpt: (EX-99.1) EX-99.1 Exhibit 99.1 Fed Ex Reports Higher Third Quarter Diluted EPS of $3.51 and Adjusted Diluted EPS of $3.86 Operating Income Up 19% Year Over Year; Up 16% on an Adjusted Basis Reduces Capital Spending Forecast Plans...
Valuation Table
9.8/10Decision Grade