Bernstein SocGen Group has reaffirmed its Outperform rating for FedEx (NYSE:FDX) and maintained a $427.00 price target on the package delivery company. The assessment comes as FedEx shares have enjoyed strong momentum, returning roughly 62% over the last six months and trading near $366, even though InvestingPro data indicates the stock is currently trading above its Fair Value.
The research note underscores management's long-range financial objectives, including a $25 earnings-per-share target for calendar 2029 and a forecast of $16 billion in free cash flow across the next three years. Those targets sit alongside the company's recent trailing-12-month performance, which shows diluted EPS of $18.14 and free cash flow of $4.35 billion.
On the top line, FedEx projects 4% revenue growth for its standalone parcel business and anticipates 200 basis points of margin expansion for that unit. Management has said it will place greater emphasis on business-to-business shipments and higher-revenue business-to-consumer parcels, while deemphasizing lower-value, shorter-haul e-commerce traffic.
For fiscal year 2026, FedEx provided preliminary margin expectations for its newly reported segments - Domestic and International - with the company targeting an 8.9% margin domestically and 3.6% internationally. The firm plans to publish fully recast financials in August, which will incorporate the new segment reporting in greater detail.
FedEx reported $90.1 billion in revenue and a 27.6% gross profit margin, figures that analysts cite when assessing the company's ability to absorb and execute strategic shifts. InvestingPro also flags several corporate strengths, including a 24-year streak of maintaining dividend payments.
Looking ahead, FedEx believes its Network 2.0 program and improvements in revenue mix will help drive domestic margins toward a 10% target, while European restructuring and a focus on B2B freight are expected to lift international margins to roughly 8%. Capital spending is expected to moderate and average about 4% of sales over the forecast period.
Bernstein noted that capacity rationalization in both U.S. and EU markets should improve FedEx's pricing leverage, offering potential upside to targets beyond the current outlook. The research team explicitly stated that the InPost transaction is not included in its baseline projections.
In corporate actions, FedEx declared a quarterly cash dividend of $1.45 per share, payable April 1, 2026, unchanged from prior payments. The company also confirmed it is participating in a consortium to acquire InPost, the Polish parcel locker and home delivery operator, committing $2.6 billion to a deal that values InPost at 27.8 billion.
Other brokerages have adjusted their views following FedEx's strategic disclosures. UBS raised its price target to $412.00 from $314.00 while maintaining a Buy rating, citing benefits from pricing and cost control. Stephens increased its target to $405.00 from $330.00 after taking in details presented at FedEx's Investor Day. Separately, Bernstein's coverage reflects a prior change in its valuation framework - the firm moved its price target from $306.00 to $427.00 in its most recent assessment, a revision the research team ties to expected margin improvement.
Together, these analyst moves and corporate initiatives contribute to a broadly constructive outlook on FedEx's prospects. The combination of margin programs, revenue mix improvements, and the InPost investment are central to the bullish case, while the company continues to provide updated financial detail with a full recast planned for August.