Key Stats for FedEx Corporation Stock
- Past-30-Day Performance: 24%
- 52-Week Range: $194 to $384
- Valuation Model Target Price: $432
- Implied Upside: 13%
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What Happened?
FedEx Corporation stock surged about 24% over the last 30 days, recently trading near $383 per share after touching a new 52 week high of $384.
The sharp rally reflects renewed investor confidence following the company’s Investor Day, where management laid out a clearer path toward margin expansion and higher free cash flow over the next several years.
The stock moved higher specifically because analysts raised price targets after management introduced stronger long term financial targets.
Bank of America lifted its price target to $414 and maintained a Buy rating, BMO Capital Markets raised its target to $400 from $290 while keeping a Market Perform rating, and TD Cowen increased its target to $383 and reiterated a Buy rating.
Those upward revisions signaled improved earnings visibility and helped drive momentum, even though the broader consensus price target remains near $330 to $331.
Institutional activity during the quarter also showed active positioning. Pallas Capital Advisors increased its stake by 142.8% to 12,793 shares valued at about $3.02 million, and Varma Mutual Pension Insurance raised its position by 8.7% to 34,920 shares worth about $8.23 million.
Meanwhile, Shell Asset Management, Wealthfront Advisers, Illinois Municipal Retirement Fund, CIBC World Market, and Rhumbline Advisers trimmed holdings, while denkappart Operations GmbH and Krilogy Financial initiated new positions.
Institutional investors collectively own roughly 84.47% of the company, underscoring continued large-cap sponsorship.
The rally has also been supported by FedEx’s updated long term targets, including 4% annual revenue growth to $98 billion by 2029 and 200 basis points of operating margin expansion to 8%.
CFO John Dietrich stated the company expects to deliver “$8 billion in operating income and an operating margin of 8% in 2029,” alongside a 2029 GAAP EPS target of $25, excluding FedEx Freight.
Management also outlined $2 billion of cumulative cost savings by 2027 and projected $6 billion in adjusted free cash flow in 2029, reinforcing the view that operating leverage and disciplined capital allocation could drive sustained earnings growth.
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Is FedEx Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 4.5%
- Operating Margins: 7.2%
- Exit P/E Multiple: 16.5x
Revenue is projected to grow at roughly 4% annually, supported by disciplined yield expansion and growth in higher margin B2B services.
Management expects balanced contributions from pricing and volume, with a meaningful portion of incremental revenue tied to higher margin segments, which can enhance profitability even in a moderate demand environment.
Margin expansion remains the central driver of value creation. The company is targeting operating margin improvement from 6% to 8% by 2029, supported by Network 2.0 initiatives, structural cost reductions, and tighter capital discipline.
Lower capital intensity and improving free cash flow strengthen financial flexibility and support dividends and share repurchases.
Based on these inputs, the valuation framework implies a target price near $432, representing about 13% potential upside.
If management continues executing on cost savings, mix improvement, and operating leverage, FedEx appears modestly undervalued heading into 2026, with performance likely driven by margin expansion rather than aggressive revenue acceleration.
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