Street Calls of the Week
Investing.com - Stifel has lowered its price target on FedEx (NYSE:FDX) to $308.00 from $315.00 while maintaining a Buy rating on the stock. The $54 billion market cap logistics giant, currently trading at a P/E of 13.7x, appears undervalued according to InvestingPro analysis.
The research firm cited macroeconomic headwinds as a key concern ahead of FedEx’s fiscal first-quarter 2026 earnings report, scheduled for September 18. Specifically, Stifel pointed to tariff uncertainty and the impact of the de minimis rule change as likely pressures on shipping volumes. Despite these challenges, InvestingPro data shows the company maintains a GOOD financial health score, with particularly strong profitability metrics.
Stifel also anticipates a subdued peak shipping season, noting that soft consumer confidence is translating into conservative positioning by shippers. Despite these challenges, the firm believes FedEx has significant opportunity through its cost-cutting initiatives.
The upcoming earnings report will provide investors with the clearest view yet of progress on the company’s Network 2.0 initiative and whether FedEx can offset or exceed the headwinds from weaker demand, according to Stifel’s analysis.
Despite a wide range of potential outcomes, Stifel maintains that at current valuation levels, the midterm risk-reward profile for FedEx is biased to the upside, particularly if a modest upcycle occurs in the next 12 months and considering the potential valuation opportunity from the planned Freight spin-off in 2026. The company has maintained dividend payments for 24 consecutive years, with a current yield of 2.55%. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, including detailed analysis of FedEx’s financial health and growth prospects.
In other recent news, FedEx has faced several analyst adjustments and company developments. Evercore ISI downgraded FedEx stock from Outperform to In Line, reducing the price target to $243 due to demand headwinds that could affect near-term earnings estimates. Goldman Sachs also lowered its price target for FedEx to $276, citing uncertainties around tariffs impacting global trade. Similarly, JPMorgan adjusted its price target to $285, maintaining an Overweight rating but expressing concerns over stagnant business-to-business demand and other challenges that could affect upcoming earnings. UBS decreased its price target to $293 following reports of a slowdown in volume growth, particularly in the Ground division.
Additionally, FedEx has made a significant leadership change by appointing Vishal Talwar as executive vice president, chief digital and information officer, and president of FedEx Dataworks. Talwar, who brings over 27 years of experience in technology, joins from Accenture Technology. These developments highlight the various strategic and operational shifts currently underway at FedEx.
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