FedEx Stock Faces Downgrade Amid Looming Freight Spin-Off and $355 Target
FedEx is navigating a complex landscape as analysts adjust their ratings in anticipation of its upcoming freight segment spin-off. This strategic move, set to conclude by June 1, 2026, aims to enhance shareholder value.
Recent Analyst Ratings
The ratings for FedEx stocks have seen significant changes recently. Rothschild Redburn downgraded its rating from Buy to Neutral, establishing a price target of $317. Conversely, Argus has taken a more optimistic stance, raising its target from $250 to $350 while reaffirming a buy rating.
Stock Performance
FedEx shares have experienced a notable increase of approximately 37% over the past three months. As of the latest report, the stock closed at $306.95, which is still about 3.7% short of its 52-week high of $318.83 reached on January 9, 2026.
Freight Spin-Off Overview
FedEx plans to spin off its freight division, a less-than-truckload (LTL) segment, which consolidates various smaller shipments. This decision has sparked investor interest, with many believing that this separation will unlock substantial value.
- Estimated revenue of FedEx Freight for fiscal 2025: $8.9 billion
- Expected operating income: $1.3 billion
Following research into FedEx Freight’s Form 10 filing, Wolfe Research adjusted its price target to $355 while maintaining an Outperform rating. The firm highlighted FedEx Freight’s operating income of $546 million for the first half of fiscal 2026.
Market Outlook
Filmogaz reports a diverse range of opinions from analysts concerning FedEx. Currently, 22 analysts cover the company: eight are bullish, while ten express a neutral perspective. The average 12-month price target stands at $305.91, with a range between $210 and $360.
The consensus rating across the board is categorized as Hold, with an average price target of $303.03. Analysts warn that any setbacks in the freight sector or a downturn in shipping activity could negatively impact FedEx’s current valuation.
Future Expectations
CEO Raj Subramaniam has characterized the planned spin-off as a significant step forward in FedEx’s evolution. Newly appointed FedEx Freight CEO John Smith views this transition as a critical milestone. FedEx contends that the spin-off will result in the formation of two world-class companies, each positioned for growth.
