FedEx Freight Spinoff, Reporting Shift Bring Near-Term Noise But Should Aid Profitability, Cash Flow, UBS Says

MT Newswires Live

Jun 24

FedEx's (FDX) spinoff of its freight business and transition to calendar year reporting will create some near-term noise but should improve structural profitability and cash flow in the longer term, UBS analysts said in a Wednesday note.

The spinoff and reporting transition make it difficult to analyze its 2026 adjusted earnings per share guidance of between $16.90 and $18.10, analysts said.

Analysts said that the company's capital spending is expected to remain disciplined at roughly 4% of revenue, supporting strong free cash flow generation.

UBS said that FedEx's volume and revenue growth could be important to leveraging gains in cost structure.

UBS retained a buy rating on the stock, but lowered its price target to $350 from $445.

Price: 315.18, Change: -2.06, Percent Change: -0.65

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