Analyst Ravi Shanker of Morgan Stanley maintained a Sell rating on FedEx, retaining the price target of $200.00.
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Ravi Shanker has given his Sell rating due to a combination of factors impacting FedEx’s financial outlook. Despite FedEx’s non-GAAP earnings per share surpassing expectations, the GAAP earnings fell short, indicating potential issues with earnings quality. The company’s Express segment performed better than anticipated, but this was counterbalanced by weaker results in the Freight segment, which missed expectations significantly.
Additionally, while FedEx has provided a strong revenue forecast for the fiscal year 2026, the earnings per share guidance falls below consensus estimates. Concerns also arise from high conversion and spin costs, as well as questions about the sustainability of operating leverage and pricing strategies amidst competitive pressures. These elements suggest structural challenges rather than temporary setbacks, leading to a cautious outlook on FedEx’s stock performance.
Shanker covers the Industrials sector, focusing on stocks such as FedEx, Allegiant Travel Company, and JB Hunt. According to TipRanks, Shanker has an average return of -1.0% and a 47.14% success rate on recommended stocks.