Straight up with FedEx's Q4 FY25 Earnings
Analysts' Predictions Regarding FedEx Stock Prior to Earnings Release
Here's the lowdown on FedEx's anticipated earnings report for Q4 of their fiscal year 2025, dropping post-market on Tuesday.
Wall Street's analysts are feeling pretty darn bullish about ol' FedEx (FDX). Out of the 14 tracking the company, 12 call it a buy while the other two give it a "hold" or equivalent rating. They've got an average price target rounding out at roughly $278, implying a 20% jump from Tuesday's intraday price at around $232. The stock's lost nearly 20% this year, poor thing.
Fourth-quarter revenue's predicted to take a minor hit, around 1%, to $21.81 billion. But don't worry, 'cause adjusted EPS is expected to skyrocket more than 8% to $5.86, thanks to FedEx's ongoing cost-cutting efforts.
Last quarter, FedEx fell short of expectations, missing the mark and slashing their full-year projection for the third consecutive quarter, citing a "real tough operational environment."
Just ahead of Tuesday's earnings report, UBS analysts dropped their price target for FedEx stock from $331 to $311. They're also anticipating a more moderate volume and revenue performance for 2026, along with fewer margin improvements for both the Federal Express and Freight segments.
Morgan Stanley analysts, however, with an "underweight" rating and a $200 price target, swear FedEx is going to miss the estimates for the Q4. They say it's "going to be a noisy miss," despite Q4 representing the final quarter of their "DRIVE" savings program. They attribute this to factors like inflationary pressures, one fewer operating day, tariff-related volume headwinds, and B2B weakness, adding that the fiscal 2026 outlook will likely be more crucial for the stock than Tuesday's Q3 results.
June 24, 2025 Update: The article's been updated to reflect more recent analyst estimates and share values.
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In case you're wondering, FedEx delivered some impressive Q4 FY25 earnings, beating analyst projections with an adjusted EPS of $6.07 compared to the estimated $5.87 per share, and revenue of $22.2 billion, surpassing the estimated $21.84 billion. The boost in Federal Express can swing to improvements in their cost reduction efforts, though the Freight segment dealt with operational challenges like lower fuel surcharges and increased expenses.
Despite the Q4 triumph, the company's fiscal 2026 outlook left investors underwhelmed, particularly for Q1 earnings and projected revenue growth, which led to the stock taking a dive. FedEx is eyeing permanent cost reductions totaling $1 billion through their DRIVE and Network 2.0 transformation initiatives in FY26, reflecting management's determination to maintain structural efficiency amid escalating headwinds.
Tariffs may pose a potential threat, though not explicitly discussed in the Q4 earnings report, serving as a known risk factor that could drive up costs and affect supply chains, considering FedEx operates globally. The uncertain outlook likely stems from factors like geopolitical concerns and pressures on shipping costs attributed to tariffs, which could impact the logistics industry as a whole.
In a nutshell, FedEx's latest operational improvements led to a solid Q4 performance, but fiscal 2026 earnings growth may face obstacles from weak demand and cost pressures, including the possibility of tariff impacts on global logistics.
- Investors in the finance business may consider the potential for investing in FedEx's Initial Coin Offering (ICO), given the positive outlook on the company's Q4 FY25 earnings.
- The success of FedEx's cost-cutting efforts, as shown in their Q4 FY25 earnings, could significantly impact the overall business performance and attract more investors looking for opportunities in such tokenized finance ventures.
