FedEx’s Historical Stock Performance and Comparison to S&P 500
Over the past few years, FedEx’s stock has displayed minimal movement, hovering around $250, contrasting with the S&P 500, which surged approximately 45% during the same timeframe. The company exhibited a lackluster performance, with varied returns each year.
Challenges in Beating the S&P 500
The arduous task of outperforming the S&P 500 has plagued various sectors, including Industrials heavyweights like CAT and UNP, as well as tech giants like GOOG, TSLA, and MSFT. Interestingly, the High Quality Portfolio, consisting of 30 stocks, consistently outperformed the S&P 500 annually, presenting a compelling case for diversified investment strategies.
Valuation Perspective of FedEx Stock
Despite the prevailing macroeconomic uncertainties, including soaring oil prices and heightened interest rates, FedEx’s stock might witness growth potential. Estimated at $294 per share, reflecting an 18% increase from the current $250, the valuation underscores the company’s performance potential based on forward earnings.
An In-depth Look at FedEx’s Recent Performance and Projections
In the past quarter, FedEx’s revenue witnessed a slight decline of 2% year-over-year, stemming from reduced average volumes. However, the company’s strategic initiatives led to an expansion in the adjusted operating margin, resulting in a positive bottom line.
Anticipating a 1% year-over-year increase with revenues around $22.2 billion in the latest quarter, FedEx is set to benefit from stabilized average daily package volumes amidst challenging consumer demands due to high inflation. The company’s cost-cutting efforts are also poised to contribute to a projected 9% year-over-year growth in the bottom line.
Future Expectations and Overall Outlook for FedEx
With an optimistic outlook for Q4 results, FedEx is projected to capitalize on stabilized volumes and margin expansions, which could positively influence its stock performance in the foreseeable future.
Comparing FedEx’s Performance with Peers
While FedEx’s stock shows promise for potential growth, assessing how it fares against peers is essential. Detailed comparisons with industry counterparts can provide valuable insights and aid in informed investment decisions.
Statistical Snapshot of Returns
| Returns | Jun 2024 MTD [1] |
2024 YTD [1] |
2017-24 Total [2] |
| FDX Return | -2% | -2% | 33% |
| S&P 500 Return | 4% | 15% | 145% |
| Trefis Reinforced Value Portfolio | 4% | 8% | 666% |
[1] Returns as of 6/18/2024
[2] Cumulative total returns since the end of 2016