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Investing.com - JPMorgan has reiterated its Overweight rating and $290.00 price target on FedEx (NYSE:FDX) despite the shipping giant’s unusual decision not to provide a full-year outlook. Currently trading at $229.51, FedEx shows potential upside according to InvestingPro data, with analyst targets ranging from $200 to $329.
FedEx broke with its 13-year tradition by withholding initial full-year guidance, marking the first time since fiscal 2021 (during June 2020) that the company has taken this approach. The company’s first-quarter fiscal 2026 guidance came in "well below consensus," according to JPMorgan. InvestingPro data reveals that 13 analysts have recently revised their earnings estimates downward for the upcoming period, though the company maintains a GOOD overall financial health score.
The investment bank noted that FedEx will likely provide a full-year outlook when there is "greater clarity on trade policy," following a similar approach taken by UPS, which put its 2025 guidance on hold during its April earnings call.
Based on FedEx’s first-quarter fiscal 2026 range, JPMorgan calculates an implied fiscal 2026 earnings per share of $15-17, which falls "well below buy-side expectations" of $18-20. The bank warned these figures "could still be at risk if the trade dynamic between the U.S. and EU deteriorates."
JPMorgan had previously recommended avoiding FedEx stock ahead of its fourth-quarter fiscal 2025 earnings report, noting that sentiment on FedEx and the parcel sector "remains negative" and expecting that earnings estimates will be "more weighted to fiscal second-half 2026 than normal."
In other recent news, FedEx Corporation reported its fourth-quarter earnings for fiscal year 2025, surpassing expectations with an earnings per share (EPS) of $6.07, compared to the forecasted $5.96. The company’s revenue also exceeded projections, coming in at $22.2 billion against the anticipated $21.84 billion. FedEx has announced plans for a significant FedEx Freight spin-off slated for June 2026, which could impact its operational structure. Analysts have shown positive sentiment, with several firms noting the company’s effective cost management and operational efficiency. The company has been focusing on its Network 2.0 initiative, which aims to bring $2 billion in savings. FedEx is targeting $1 billion in transformation-related savings for fiscal year 2026. The company has also experienced a strategic leadership change, with Brad Martin being elected as the chairman of the board following the passing of founder Frederick W. Smith. As global trade dynamics shift, FedEx continues to adapt its network, particularly in the Asia-US lane, to align with evolving demand patterns.
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