FEDEX CORP (FDX) Stock Analysis
FEDEX CORP (FDX) Stock Analysis
Analysis from 10-Q filed 2025-12-18. Data as of Q1 2026.
Overall Grade: F (Concerning)
FEDEX CORP faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 6.3% | Below expectations |
| FCF Margin | 4.8% | Cash flow pressure |
| Debt/Equity | 0.8x | Moderate leverage |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
Explore FEDEX CORP: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: FEDEX CORP earns 6.3% ROIC, Bottom 50% in Transportation
FEDEX CORP's trailing-twelve-month ROIC of 6.3% ranks Bottom 50% in Transportation companies (sector median: 6.7%), driven by NOPAT margin of 4.7% combined with asset turnover of 1.0x. Source: 10-Q filed 2025-12-18.
| Metric | FDX | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 6.3% | Warning | Below sector median of 6.7% |
| Return on Equity (ROE) | 16.0% | Good | Efficient use of shareholder equity |
| Operating Margin | 6.2% | Adequate | Moderate operational efficiency |
Cash Flow: FEDEX CORP generates $4.4B FCF at 4.8% margin, positive NaN/8 quarters
FEDEX CORP generated $4.4B in free cash flow (TTM), a 4.8% FCF margin, a margin that ranks Top 50% in Transportation. Operating cash flow exceeds net income by 1.8x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-12-18.
| Metric | FDX | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 4.8% | Warning | Thin cash margins |
| Free Cash Flow (TTM) | $4.4B | Good | Positive cash generation |
| OCF/Net Income | 1.8x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: FEDEX CORP at 0.8x leverage
FEDEX CORP's debt-to-equity ratio of 0.8x reflects elevated leverage. Total debt of $22.8B offset by $8.0B in cash. Source: 10-Q filed 2025-12-18.
| Metric | FDX | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.8x | Adequate | Moderate leverage |
| Net Cash Position | $-14.8B | Warning | Net debt position |
Valuation: FEDEX CORP trades at 20.5x earnings
FEDEX CORP trades at a P/E of 20.5x. Free cash flow yield of 4.8% reflects market expectations for growth.
| Metric | FDX | Rating | Context |
|---|---|---|---|
| P/E Ratio | 20.5x | Adequate | Premium valuation |
| EV/Sales | 1.1x | Excellent | Attractive revenue multiple |
| FCF Yield | 4.8% | Good | Lower cash yield |
| Dividend Yield | 1.5% | Adequate | Growth focus over income |
Capital Allocation: FEDEX CORP returns 2.9% shareholder yield
FEDEX CORP's total shareholder yield is 2.9% (dividends 1.5% + buybacks 1.4%). Source: 10-Q filed 2025-12-18.
| Metric | FDX | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 2.9% | Adequate | Dividend + buyback yield combined |
| Buyback Yield | 1.4% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $2.6B | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 6.3% | Bottom 50% | 0.9x below |
| Free Cash Flow Margin | 4.8% | Top 50% | 1.3x above |
| Operating Margin | 6.2% | Bottom 50% | 1.0x below |
| Return on Equity (ROE) | 16.0% | Top 50% | 1.5x above |
| P/E Ratio | 20.5x | N/A | - |
Financial Scorecard
| Metric | FDX | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 6.3% | Warning | Bottom 50% of sector (median: 6.7%) |
| Free Cash Flow Margin | 4.8% | Warning | Top 50% of sector (median: 3.8%) |
| Debt to Equity Ratio | 76.6% | Adequate | Elevated but manageable |
| P/E Ratio (Price-to-Earnings) | 20.5x | Adequate | Fair value |
| Free Cash Flow Yield | 4.8% | Adequate | Moderate yield |
Frequently Asked Questions
Q: What is FEDEX CORP's Return on Invested Capital (ROIC)?
FEDEX CORP (FDX) has a trailing twelve-month Return on Invested Capital (ROIC) of 6.3%. This compares below the sector median of 6.7%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is FEDEX CORP's Free Cash Flow Margin?
FEDEX CORP (FDX) has a free cash flow margin of 4.8%, generating $4.4 billion in free cash flow over the trailing twelve months. A thin FCF margin may indicate heavy reinvestment or operational challenges.
Q: Is FEDEX CORP stock overvalued or undervalued?
FEDEX CORP (FDX) trades at a P/E ratio of 20.5x, which is above the sector median of N/A. The EV/Sales multiple is 1.1x. Free cash flow yield is 4.8%, which is in line with market averages.
Q: Does FEDEX CORP pay a dividend?
FEDEX CORP (FDX) currently pays a dividend yield of 1.5%. Including share buybacks, the total shareholder yield is 2.9%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.
Q: How much debt does FEDEX CORP have?
FEDEX CORP (FDX) has a debt-to-equity ratio of 0.8x with total debt of $22.8 billion. Net debt position is $14.8 billion.
Q: What is FEDEX CORP's revenue and earnings growth?
FEDEX CORP (FDX) grew revenue by 4.7% year-over-year. Earnings per share increased by 17.8% compared to the prior year. Modest growth indicates a mature business with stable demand.
Q: Is FEDEX CORP buying back stock?
FEDEX CORP (FDX) repurchased $1.3 billion of stock over the trailing twelve months. This represents a buyback yield of 1.4%.
Q: How does FEDEX CORP compare to competitors in Transportation?
Compared to other companies in Transportation, FEDEX CORP (FDX) shows: ROIC of 6.3% is below the sector median of 6.7% (Bottom 48%). FCF margin of 4.8% exceeds the sector median of 3.8% (Top 46% of sector). These rankings are based on MetricDuck's analysis of all Transportation companies with available SEC filings.
Q: What warning signs should I watch for with FEDEX CORP?
Investors in FEDEX CORP (FDX) should monitor these potential warning signs: 1) FCF margin is thin at 4.8%, leaving limited buffer for economic downturns. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-12-18. TTM metrics as of Q1 2026.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.