UBS Adjusts FedEx Price Target Ahead of Freight Spinoff
UBS cuts FedEx stock price target to $445 on spinoff valuation
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UBS has lowered its price target for FedEx Corp. (NYSE: FDX) from $446 to $445 while maintaining a Buy rating. This adjustment comes as FedEx prepares for the spinoff of its freight business, which will begin trading as a separate entity on June 1, 2026, following the SEC's approval.
- 01FedEx's stock is currently trading at $392.53, reflecting an 82% increase over the past year.
- 02The freight business will trade under the ticker FDXF starting June 1, 2026.
- 03UBS applied a 7.4x EV/EBITDA multiple for FedEx's parcel business, which is below UPS's 8.4x multiple.
- 04The freight business valuation was set at a 19.6x EV/EBITDA multiple, consistent with competitors like Old Dominion Freight Line.
- 05FedEx is enhancing its logistics capabilities through a collaboration with ServiceNow to improve supply chain management.
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UBS has adjusted its price target for FedEx Corp. (NYSE: FDX) to $445 from $446, while keeping a Buy rating on the stock, which is currently priced at $392.53. This change comes in anticipation of the upcoming spinoff of FedEx's freight business, set to begin trading as a separate entity under the ticker FDXF on June 1, 2026. UBS's valuation used a 7.4x EV/EBITDA multiple for FedEx's parcel operations, which is lower than the 8.4x multiple for competitor UPS. For the freight unit, UBS applied a 19.6x EV/EBITDA multiple, aligning with industry peers such as Old Dominion Freight Line. Recent developments also include FedEx's collaboration with ServiceNow to integrate logistics data into their procurement platform, enhancing supply chain solutions. Additionally, FedEx and UPS shares saw a decline following Amazon's announcement of its new supply chain services, which allows third-party shippers to utilize Amazon's logistics network. Analysts from Stifel noted that the market's reaction to Amazon's expansion was exaggerated.
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The adjustment in price target reflects market sentiment regarding FedEx's valuation ahead of its freight spinoff, which could influence investor decisions and stock performance.
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