FedEx Freight
FDXF
$137.55
-4.72%
FedEx Freight Holding Company, Inc. is a North America-based less-than-truckload (LTL) transportation and freight services provider, offering Priority, Economy, and Direct shipping services. As a spin-off from FedEx Corporation, it stands as a pure-play LTL market leader with a vast network across the U.S., Canada, Mexico, Puerto Rico, and the U.S. Virgin Islands. The current investor narrative centers on the value-unlocking potential of the spin-off, with a massive cash infusion and a focus on improving profitability and operational efficiency. Recent news highlights the post-spinoff value creation, driving attention to margin expansion and growth acceleration in the LTL segment.…
FDXF
FedEx Freight
$137.55
Related headlines
FDXF 12-Month Price Forecast
Wall Street consensus
Most Wall Street analysts maintain a constructive view on FedEx Freight's 12-month outlook, with a consensus price target around $169.42 and implied upside of +23.2% versus the current price.
Average Target
$169.42
0 analysts
Implied Upside
+23.2%
vs. current price
Analyst Count
—
covering this stock
Price Range
$108 - $200
Analyst target range
The stock is covered by 12 analysts, with a consensus recommendation of 'Buy' (mean score 1.92 on a 5-point scale). The average target price is $169.42, implying approximately 7.2% upside from the current price of $158. The distribution shows a bullish lean, with no sell ratings indicated. The target range spans from a low of $108 to a high of $200, reflecting significant uncertainty. The high target of $200 assumes a return to the 52-week high, likely driven by successful execution of the spin-off strategy and margin recovery. The low target of $108 implies a 32% downside, pricing in continued revenue decline and margin compression. The wide spread (92 points) indicates low conviction among analysts, which is common for a recently spun-off company. The only institutional rating change noted is BMO Capital maintaining 'Market Perform' in June 2026, suggesting a neutral stance. Limited coverage and wide target dispersion imply higher volatility and less efficient price discovery for this stock.
Bulls vs Bears: FDXF Investment Factors
FDXF presents a mixed picture: the spin-off narrative and pure-play LTL focus offer potential for value creation, but the company is currently experiencing a sharp downturn in revenue, earnings, and free cash flow. The trailing P/E of 17.0x appears reasonable, but the forward P/E of 31.5x and negative PEG ratio suggest the market expects further earnings deterioration. The bull case hinges on successful execution of the spin-off strategy and margin recovery, while the bear case is driven by declining fundamentals and negative cash flow. The most critical tension is whether the recent earnings decline is cyclical or structural—if temporary, the stock could be undervalued; if permanent, further downside is likely. Currently, the bearish evidence from deteriorating financials outweighs the bullish spin-off narrative, making the stock a high-risk proposition.
Bullish
- Pure-Play LTL Market Leader: As a spin-off from FedEx, FDXF is a pure-play less-than-truckload (LTL) provider with a vast North American network. This focus allows for operational improvements and margin expansion, with analysts targeting a 7.2% upside to the average price of $169.42.
- Post-Spinoff Value Unlocking: The spin-off is a major value-unlocking event, providing a massive cash infusion and positioning the core business for higher profitability. This narrative is supported by recent news highlighting billions in post-spinoff value creation.
- Reasonable Trailing P/E: The trailing P/E of 17.0x is near the middle of its 52-week range of 13.5x-23.7x, suggesting the stock is not overvalued on a historical basis. This could attract value-oriented investors if earnings stabilize.
- Strong ROE and Liquidity: ROE stands at 28.9%, indicating efficient use of equity, while the current ratio of 1.76 and debt-to-equity of 0.38 reflect a solid balance sheet with moderate leverage and adequate liquidity.
Bearish
- Declining Revenue and Earnings: Revenue fell 4.69% YoY in Q3 FY2026 to $1.991 billion, and net income plummeted 79.7% to $51 million. Operating income turned negative at -$6 million, signaling severe operational deterioration.
- Negative Free Cash Flow: Free cash flow swung from positive $125 million in Q3 FY2025 to negative -$470 million in Q3 FY2026, driven by large working capital outflows. This raises concerns about the company's ability to fund operations without external financing.
- High Forward P/E and Negative PEG: The forward P/E of 31.5x is nearly double the trailing multiple, implying the market expects earnings to decline further. The negative PEG ratio of -0.57 confirms that earnings are projected to shrink, justifying a lower valuation.
- Wide Analyst Target Range: Analyst targets range from $108 to $200, a spread of 92 points, indicating low conviction and high uncertainty. The low target implies 32% downside from the current price, reflecting risks of continued revenue decline.
FDXF Technical Analysis
FDXF is trading in a sustained downtrend from its 52-week high of $200, with the current price of $158 representing 79% of the 52-week range. The 1-year price change is +3.21%, significantly underperforming the S&P 500's +16.47% gain, indicating relative weakness. The stock is closer to the 52-week low of $135 than the high, suggesting a value opportunity but also reflecting bearish sentiment. Over the past month, FDXF has declined 1.527%, while the S&P 500 gained 0.78%, resulting in a negative relative strength of -2.307%. The 3-month price change is not directly provided, but the stock has fallen from a June high of $188.46 to $158, a 16% decline, indicating decelerating momentum. This divergence from the longer-term trend (1-year positive but recent weakness) could signal a temporary pullback or a potential trend reversal if support holds. The 52-week low of $135 serves as key support, while resistance is at the 52-week high of $200. A break below $135 would signal further downside, while a move above $200 would indicate a strong recovery. Beta is not provided, but the stock's volatility is evident from a 24.76% maximum drawdown, suggesting higher risk than the broader market.
Beta
—
—
Max Drawdown
-27.0%
Largest decline past year
52-Week Range
$135-$200
Price range past year
Annual Return
—
Cumulative gain past year
| Period | FDXF Return | S&P 500 |
|---|---|---|
| 1m | -8.9% | -0.7% |
| 3m | — | +2.9% |
| 6m | — | +7.2% |
| 1y | — | +16.9% |
| ytd | — | +8.8% |
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FDXF Fundamental Analysis
Revenue has been declining, with the most recent quarter (Q3 FY2026) reporting $1.991 billion, down 4.69% year-over-year from $2.089 billion in the prior-year quarter. The multi-quarter trend shows deceleration: Q1 FY2026 revenue was $2.198 billion, Q2 was $2.139 billion, and Q3 was $1.991 billion, indicating a clear downtrend. The company's net income in Q3 FY2026 was $51 million, a sharp drop from $251 million in the same quarter last year, with net margin falling to 2.56% from 12.02%. Gross margin compressed to 24.81% from 28.53% a year ago, reflecting cost pressures or pricing challenges. The company is still profitable, but profitability is deteriorating; operating income turned negative at -$6 million in Q3 FY2026, compared to $242 million in Q3 FY2025. The balance sheet shows a debt-to-equity ratio of 0.38, indicating moderate leverage, and a current ratio of 1.76, suggesting adequate liquidity. However, free cash flow turned deeply negative at -$470 million in Q3 FY2026, driven by a large working capital outflow, compared to positive $125 million in the year-ago quarter. ROE is 28.9%, but this is based on trailing data; the recent earnings decline raises sustainability concerns.
Quarterly Revenue
$2.0B
2026-02
Revenue YoY Growth
-4.7%
YoY Comparison
Gross Margin
24.8%
Latest Quarter
Free Cash Flow
$354000000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
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Valuation Analysis: Is FDXF Overvalued?
Since net income is positive (TTM net income of $51 million in the latest quarter), the primary valuation metric is the P/E ratio. The trailing P/E is 17.0x, while the forward P/E is 31.5x, indicating the market expects earnings to decline significantly. The gap between trailing and forward P/E suggests pessimistic earnings expectations, as the forward multiple is much higher. Compared to the industry average (not provided), the stock's P/E of 17.0x may appear reasonable, but the forward P/E of 31.5x implies a premium if earnings recover. The P/S ratio of 2.06x and EV/Sales of 0.61x provide alternative perspectives. Historically, the trailing P/E has ranged from 13.5x to 23.7x over the past year; the current 17.0x is near the middle of that range. The P/B ratio of 4.91x is below the historical high of 8.79x, suggesting the stock is not overvalued on a book basis. However, the negative PEG ratio of -0.57 indicates that earnings are expected to decline, which justifies a lower multiple.
PE
17.0x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 14x~24x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
10.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: FDXF's financials are under severe pressure. Revenue declined 4.69% YoY in Q3 FY2026, and net income dropped 79.7% to $51 million, with operating income turning negative at -$6 million. Free cash flow swung to -$470 million from positive $125 million a year ago, indicating a cash burn that could strain liquidity despite a current ratio of 1.76. The debt-to-equity ratio of 0.38 is manageable, but the negative free cash flow raises concerns about the company's ability to service debt if the downturn persists. The net margin compressed from 12.02% to 2.56%, highlighting operational inefficiency.
Market & Competitive Risks: The stock is trading at a forward P/E of 31.5x, a premium to its trailing multiple of 17.0x, implying the market expects earnings to decline further. This valuation compression risk is significant if earnings disappoint. The LTL industry is competitive, with players like XPO and Old Dominion Freight Line, and FDXF's revenue decline suggests market share loss or pricing pressure. The stock's 1-year price change of +3.21% underperformed the S&P 500's +16.47%, indicating relative weakness. Beta is not provided, but the 24.76% maximum drawdown suggests high volatility. Recent news highlights the spin-off as a value-unlocking event, but execution risk remains.
Worst-Case Scenario: If the revenue decline accelerates and margins continue to compress, the stock could fall to the analyst low target of $108, representing a 31.6% downside from the current price of $158. This scenario would likely involve a prolonged downturn in LTL demand, further negative free cash flow, and potential debt covenant breaches. The 52-week low of $135 provides a nearer-term support, but a break below that could trigger a sell-off toward $108. In this adverse scenario, an investor could lose up to 31.6% of their investment.