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Memphis, Tennessee-based FedEx Corporation (FDX) provides transportation, e-commerce, and business services. Valued at $73.3 billion by market cap, the company provides worldwide express and freight delivery, ground small-parcels, less-than-truckload, supply chain management, customs brokerage services, trade facilitation, and electronic commerce solutions.
Shares of this logistics giant have underperformed the broader market over the past year. FDX has gained 17.6% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 32.1%. In 2024, FDX’s stock rose 19.8%, compared to the SPX’s 26.2% rise on a YTD basis.
Narrowing the focus, FDX’s outperformance is apparent compared to the Pacer Industrials and Logistics ETF (SHPP).The exchange-traded fund has gained about 10.1% over the past year. Moreover, FDX’s returns on a YTD basis outshine the ETF’s 3.6% gains over the same time frame.
FDX's underperformance can be attributed to a decrease in package volume compared to last year, as well as a shift towards deferred services which has impacted demand for priority services. Additionally, higher wages and transportation rates have also impacted the company's performance.
On Sep. 19, FDX shares closed up marginally reporting its Q1 results. Its revenue stood at $21.6 billion, down marginally year over year. The company’s adjusted EPS of $3.60 failed to surpass consensus estimates by 25.3%.
For the current fiscal year, ending in May 2025, analysts expect FDX’s EPS to grow 10.1% to $19.59 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in two of the last four quarters while missing the forecast on two other occasions.
Among the 27 analysts covering FDX stock, the consensus is a “Moderate Buy.” That’s based on 17 “Strong Buy” ratings, one “Moderate Buy,” seven “Holds,” and two “Strong Sells.”
This configuration is more bullish than two months ago, with 16 analysts suggesting a “Strong Buy.”
On Nov. 26, Barclays PLC (BCS) analyst Brandon Oglenski maintained a “Buy” rating on FDX with a price target of $365, implying a potential upside of 20.5% from current levels.
The mean price target of $313.30 represents a 3.4% premium to FDX’s current price levels.
