FedEx (FDX) Rockets 15% on Upbeat Guidance—Logistics Giant Defies Market Gloom

FedEx just pulled off a classic 'beat and raise'—sending its stock soaring while the broader market stumbles. Here's why Wall Street's buying the turnaround story (for now).

The catalyst:

Management's bullish FY2026 targets cut through the economic uncertainty like a hot knife through butter. Revenue growth projections now sit comfortably above analyst estimates—because nothing says 'confidence' like guidance issued during peak holiday shipping season.

Street reaction:

Analysts scrambled to upgrade price targets, with the usual suspects touting 'operational efficiencies.' Never mind that last quarter's margin compression had them sounding the alarm bells—this is logistics, where narratives flip faster than a conveyor belt jam.

The bottom line:

FDX joins the rare club of industrial stocks actually rewarding shareholders this year. Whether it's sustainable or just another case of 'guidance gymnastics' remains to be seen—after all, these are the same executives who once thought Zappos' warehouse model was the future. Package that truth carefully.

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This upbeat guidance gave investors a reason to feel more confident about FedEx heading into the busy shipping period. It also caused shares of competitor UPS (UPS) to rise, even though both companies face some challenges. For instance, FedEx and UPS had to recently ground their McDonnell Douglas MD-11 cargo planes. In fact, Boeing (BA), which makes the aircraft, recommended the MOVE after one of the planes was involved in a deadly crash last week.

Unsurprisingly, these planes play a key role in both companies’ operations. Therefore, taking them offline has raised concerns, as it could create delays and put pressure on shipping capacity, especially during the holiday season. Since FedEx and UPS are the largest cargo airlines in the world, any disruption to their services can impact the overall logistics industry. On top of that, worries about the U.S. government shutdown are adding more uncertainty.

Is FDX Stock a Good Buy?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on FDX stock based on 12 Buys, seven Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average FDX price target of $270.11 per share implies that shares are trading NEAR fair value.