Stock Analysis & Valuation FedEx Corporation (FDX.SW)

• Previous Close: CHF181.00
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, CHF	Upside, %
Artificial intelligence (AI)	n/a	n/a
Intrinsic value (DCF)		n/a
Graham-Dodd Method	72.50	-60
Graham Formula	113.00	-38

Strategic Investment Analysis

Company Overview

FedEx Corporation (FDX.SW) is a global leader in transportation, e-commerce, and business services, headquartered in Memphis, Tennessee. Operating through segments like FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services, the company provides express shipping, ground delivery, freight transportation, and supply chain solutions. With a vast network of 30,000 vehicles and 400 service centers, FedEx serves businesses and consumers worldwide, leveraging advanced logistics technology and cross-border e-commerce solutions. As a key player in the Integrated Freight & Logistics sector under Industrials, FedEx remains pivotal in global trade, last-mile delivery, and time-sensitive logistics. The company’s diversified service portfolio and strong brand recognition position it as a critical enabler of global commerce, particularly in the rapidly expanding e-commerce market.

Investment Summary

FedEx presents a mixed investment profile. With $90.2B in revenue and $3.97B in net income (FY 2023), the company demonstrates scale and profitability, supported by strong operating cash flow ($8.85B). However, its high total debt ($38.3B) and beta (1.37) indicate financial leverage and market sensitivity. The dividend yield (~1.1% based on $4.84/share) offers modest income, but capital expenditures ($6.17B) suggest ongoing reinvestment needs. FedEx’s competitive moat lies in its global logistics network, but macroeconomic headwinds (fuel costs, trade volumes) and competition from UPS and Amazon Logistics pose risks. Investors should weigh its e-commerce growth potential against cyclical industry pressures.

Competitive Analysis

FedEx’s competitive advantage stems from its extensive global infrastructure, including air and ground networks, which enable reliable express and freight services. Its FedEx Express segment dominates time-sensitive international shipping, while FedEx Ground excels in cost-efficient residential deliveries. The company’s investments in automation (e.g., robotics, AI-driven routing) enhance operational efficiency. However, FedEx faces intense competition from UPS’s similarly scaled network and DHL’s strong international presence. Amazon Logistics disrupts last-mile delivery with captive e-commerce demand, undercutting margins. FedEx’s asset-heavy model provides service control but increases fixed costs, whereas asset-light rivals like XPO Logistics adapt more flexibly to demand swings. Pricing pressure remains a challenge, though FedEx’s diversified B2B and B2C mix mitigates reliance on any single segment. Strategic initiatives like network consolidation (DRIVE program) aim to improve margins, but execution risks persist.

Major Competitors

• United Parcel Service (UPS): UPS rivals FedEx in scale, with a stronger unionized workforce (Teamsters) and dense US ground network. Its higher margin small-package business and growing healthcare logistics segment are strengths, but labor costs and international reliance on DHL partnerships are weaknesses. UPS’s $97.3B revenue (2022) slightly edges FedEx, but its recent strike threats highlight operational risks.
• Deutsche Post DHL (DHL.DE): DHL leads in international express shipping (especially Europe-Asia lanes) and contract logistics, with $94.4B revenue (2022). Its strength in emerging markets and B2B supply chains contrasts with FedEx’s US-centric ground business. However, DHL’s European exposure subjects it to regional economic volatility, and it lacks FedEx’s domestic US ground infrastructure.
• Amazon.com (AMZN): Amazon Logistics disrupts with vertically integrated e-commerce delivery, leveraging its captive volume to undercut FedEx on last-mile costs. Its asset-light model and tech-driven logistics (e.g., AWS-powered routing) are strengths, but reliance on third-party carriers for peak capacity and limited B2B focus reduce its threat to FedEx’s core express/freight segments.
• XPO Logistics (XPO): XPO focuses on asset-light freight brokerage and LTL (less-than-truckload) services, competing with FedEx Freight. Its agility in truckload procurement and tech-driven platform are strengths, but lack of owned air/express networks limits high-margin international capabilities. XPO’s $7.7B revenue (2022) is dwarfed by FedEx’s scale.