FedEx Stock: Is FDX Underperforming Industrials Sector?

With a market cap of $61.2 billion, FedEx Corporation (FDX) provides customers and businesses with a portfolio of transportation, e-commerce, and business services internationally. The Memphis, Tennessee-based company operates in four segments: FedEx Express, FedEx Ground, FedEx Freight, and FedEx Services.

Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and FedEx fits this criterion perfectly. The multinational company also offers supply chain management solutions along with trade management tools and data. 

Further, the package delivery company dipped 19.1% from its 52-week high of $313.84. Over the past three months, FedEx stock dropped 9.5%, lagging behind the Industrial Select Sector SPDR Fund (XLI), which declined 4.5% in the same period.

In the longer term, FDX is down 9.7% on a YTD basis, underperforming XLI’s 1.9% gain. In addition, shares of FDX have risen 1.5% over the last 52 weeks, while the XLI has returned 9.5%.

FDX has been trading below its 50-day moving average since late December 2024. Also, the stock has remained below its 200-day moving average since late January. 

Despite FedEx surpassing Q2 FY25 earnings expectations with adjusted EPS of $4.05 on Dec. 19, 2024, shares fell marginally the next day. Revenue of around $22 billion missed estimates and declined year-over-year, signaling demand weakness, particularly in the FedEx Freight segment. Also, the company lowered its full-year EPS guidance, expecting $16.45 - $17.45. Lastly, macroeconomic headwinds, including weak U.S. industrial production and lower-than-expected shipment volumes, added to investor apprehensions.

In comparison with its rival, Forward Air Corporation (FWRD) has lagged behind FDX, declining 33.9% over the past 52 weeks. Also, FWRD has fallen 35.8% on a YTD basis.

Despite FDX’s underperformance compared to its sector over the past year, analysts are moderately optimistic about the stock’s prospects. The stock has a consensus rating of “Moderate Buy” from the 27 analysts covering it, and as of writing, FDX is trading below the mean price target of $317.85.