SAN FRANCISCO, CALIFORNIA – SEPTEMBER 18: A FedEx truck is seen driving on September 18, 2025 in San Francisco, California. FedEx will report first-quarter earnings today after the closing bell. (Photo by Justin Sullivan/Getty Images)
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Following a challenging year, FedEx stock (NYSE: FDX) is trending higher after the company reported upbeat quarterly results and a positive sales outlook. The stock had faced significant pressure, falling 17% this year, largely due to elevated operating costs that hurt its bottom line. Now, after the latest results, the key question is: Is FDX stock a buy?
We believe the stock has room for growth. While some concerns remain, its current valuation is attractive, especially when compared to its recent operating performance and financial health. Our analysis takes into account a comprehensive comparison of the company’s current valuation against its historical financial condition and performance over recent years, as detailed in the sections below. That being said, if you seek an upside with less volatility than holding an individual stock, consider the High Quality Portfolio. It has comfortably outperformed its benchmark—a combination of the S&P 500, Russell, and S&P MidCap indexes—and has achieved returns exceeding 91% since its inception. Separately, see – What’s Happening With CRWD Stock?
How Does FedEx’s Valuation Look vs. The S&P 500?
Going by what you pay per dollar of sales or profit, FDX stock looks cheap compared to the broader market.
- FedEx has a price-to-sales (P/S) ratio of 0.6 vs. a figure of 3.2 for the S&P 500
- Additionally, the company’s price-to-free cash flow (P/FCF) ratio is 15 compared to 21.1 for S&P 500
- And, it has a price-to-earnings (P/E) ratio of 14 vs. the benchmark’s 24
How Have FedEx’s Revenues Grown Over Recent Years?
FedEx’s Revenues have fallen over recent years.
• FedEx has seen its top line decline at an average rate of 2.2% over the last 3 years (vs. increase of 5.3% for S&P 500)
• Its revenues have grown 1% from $88 Bil to $89.6 Bil in the last 12 months (vs. growth of 5.1% for S&P 500)
• Also, its quarterly revenues grew 2.8% to $22 Bil in the most recent quarter from $22 Bil a year ago (vs. 6.1% improvement for S&P 500)
How Profitable Is FedEx?
FedEx’s profit margins are much worse than most companies in the Trefis coverage universe.
- FedEx’s Operating Income over the last four quarters was $6.0 Bil, which represents a poor Operating Margin of 6.7% (vs. 18.6% for S&P 500)
- FedEx’s Operating Cash Flow (OCF) over this period was $7.6 Bil, pointing to a poor OCF Margin of 8.5% (vs. 20.3% for S&P 500)
- For the last four-quarter period, FedEx’s Net Income was $4.1 Bil – indicating a very poor Net Income Margin of 4.7% (vs. 12.6% for S&P 500)
Does FedEx Look Financially Stable?
FedEx’s balance sheet looks fine.
- FedEx’s Debt figure was $38 Bil at the end of the most recent quarter, while its market capitalization is $54 Bil (as of 9/18/2025). This implies a moderate Debt-to-Equity Ratio of 67% (vs. 20.9% for S&P 500). [Note: A low Debt-to-Equity Ratio is desirable]
- Cash (including cash equivalents) makes up $6.2 Bil of the $88 Bil in Total Assets for FedEx. This yields a moderate Cash-to-Assets Ratio of 7.0% (vs. 7.0% for S&P 500)
How Resilient Is FDX Stock During A Downturn?
FDX stock has fared worse than the benchmark S&P 500 index during some of the recent downturns. Worried about the impact of a market crash on FDX stock? Our dashboard Will You Be Comfortable Buying FedEx Stock? has a detailed analysis of how the stock performed during and after previous market crashes.
Inflation Shock (2022)
- FDX stock fell 54.7% from a high of $315.59 on 27 May 2021 to $142.90 on 26 September 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is 313.52 on 16 July 2024 and currently trades at around $225
COVID-19 Pandemic (2020)
- FDX stock fell 45.1% from a high of $164.91 on 20 February 2020 to $90.49 on 16 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
- The stock fully recovered to its pre-Crisis peak by 16 July 2020
Global Financial Crisis (2008)
- FDX stock fell 71.7% from a high of $120.97 on 23 February 2007 to $34.28 on 9 March 2009, vs. a peak-to-trough decline of 56.8% for the S&P 500
- The stock fully recovered to its pre-Crisis peak by 16 October 2013
Putting All The Pieces Together: What It Means For FDX Stock
In summary, FedEx’s performance across the parameters detailed above are as follows:
- Growth: Inconsistent
- Profitability: Very Weak
- Financial Stability: Moderate
- Downturn Resilience: Weak
- Overall: Weak
While FDX stock seems to have some room for growth, you could also explore the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.
The Bottom Line
Overall, while FedEx’s recent performance has been weak across key metrics, its low valuation suggests this is already priced into the stock. The company is currently valued at a modest 14 times trailing earnings, a figure slightly below its five-year average of 15 times. However, with revenue growth picking up and management prioritizing margin improvement, the company’s fundamentals are starting to align, creating a potential opportunity for the stock to rise.
