FedEx stock price target lowered to $297 by UBS on visibility concerns

Investing.com - UBS lowered its price target on FedEx (NYSE:FDX) to $297.00 from $311.00 on Wednesday, while maintaining a Buy rating on the package delivery giant’s shares. According to InvestingPro data, FedEx is currently trading at $222.65, with analyst targets ranging from $200 to $329, suggesting potential upside from current levels.

The price target reduction follows FedEx’s fourth-quarter adjusted earnings per share of $6.07, which exceeded the consensus estimate of $5.81 and surpassed market expectations of approximately $5.60 per share.

FedEx reported stronger-than-expected operating income in both its Federal Express and Freight segments, excluding a $33 million gain on sale that contributed $0.09 per share to the Freight division’s earnings before interest and taxes.

The company provided first-quarter fiscal 2026 guidance with a midpoint of $3.70 per share, approximately 9% below consensus estimates, and notably declined to offer a full-year outlook citing limited visibility on macroeconomic conditions and trade.

UBS indicated that FedEx shares would likely experience a "modestly negative response" to the earnings report and guidance, particularly due to the company’s cautious stance on providing forward-looking projections.

In other recent news, FedEx Corporation reported stronger-than-expected earnings for the fourth quarter of fiscal year 2025. The company achieved earnings per share of $6.07, surpassing the forecasted $5.96, and reported revenue of $22.2 billion, exceeding expectations of $21.84 billion. Despite this positive performance, FedEx’s outlook for the first quarter of fiscal 2026 shows earnings guidance of $3.40-4.00 per share, which falls below previous analyst forecasts. Evercore ISI lowered its price target for FedEx to $249.00 from $259.00, citing ongoing trade headwinds and the loss of a U.S. Postal Service contract as significant challenges. JPMorgan maintained its Overweight rating on FedEx, with a price target of $290.00, despite the company’s decision to withhold a full-year outlook. The investment bank noted that FedEx’s earnings estimates for fiscal 2026 could be at risk if trade dynamics between the U.S. and EU worsen. Additionally, FedEx is preparing for a significant spin-off of its FedEx Freight division, planned for June 2026, as part of its strategic initiatives.

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