truist securities reiterates buy rating for fedex stock

On Thursday, Truist Securities analysts maintained a Buy rating for FedEx stock (NYSE: NYSE:FDX) with a price target set at $275. Currently trading at $217.65, InvestingPro analysis suggests the stock is undervalued, with analyst targets ranging from $200 to $354. Analysts highlighted the potential value creation from the planned spin-off of FedEx Freight, scheduled for June 2026.

The analysts believe the spin-off will unlock structural value and provide operational clarity for FedEx, which currently maintains a market capitalization of $52.3 billion and trades at a P/E ratio of 13.6. They noted that the Less-Than-Truckload (LTL) business, which will become a standalone entity, is a higher-margin and more capital-efficient asset compared to FedEx’s Airfreight and Parcel divisions.

Truist Securities’ sum-of-the-parts analysis suggests a valuation range of $280-$300 per share based on fiscal year 2026 estimates, with potential to reach $340 per share by fiscal year 2027. The firm encourages investors to consider building positions in FedEx ahead of the spin-off. For deeper insights into FedEx’s valuation and financial health, access the comprehensive Pro Research Report available on InvestingPro.

The analysts anticipate that the market will increasingly recognize the value embedded in the FedEx Freight spin-off, presenting an opportunity for investors in FedEx stock, which has maintained dividend payments for 24 consecutive years and demonstrates solid financial health metrics according to InvestingPro analysis.

In other recent news, FedEx has been the focus of several key developments. The company is preparing for an upcoming earnings call, with analysts from JPMorgan anticipating earnings per share to align closely with consensus estimates, ranging between $18.50 and $19.50 for fiscal year 2026. UBS has adjusted its earnings per share estimate for the fourth quarter of fiscal year 2025 downward, from $6.22 to $5.80, citing a challenging international business environment. In terms of stock evaluations, JPMorgan lowered its price target for FedEx to $260, maintaining an Overweight rating, while UBS revised its target to $311 but kept a Buy rating.

FedEx has also achieved the CEIV Pharma Certification for its ground handling operations worldwide, marking a significant milestone in pharmaceutical logistics. Leadership changes are underway as John Smith is set to become President and CEO of FedEx Freight, with the division gearing up for a spin-off by June 2026. R. Brad Martin will serve as chairman of the board for the newly independent FedEx Freight. These strategic moves are part of FedEx’s efforts to streamline operations and enhance its service offerings.

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