Is FedEx Corporation (FDX) overvalued?
On Equity Rank's model estimate, FDX trades close to its fair value (3% below it). FedEx Corporation (FDX) last closed at $308.14; the multi-method model fair value is $316.50.
| Price | Model fair value | Price vs model |
|---|---|---|
| $308.14 | $316.50 | 3% below |
What the answer rests on
- 3 of 9 valuation methods put FDX's value above its price and 6 put it below, so the methods disagree.
- To justify today's price, FDX's free cash flow would need to grow about 4.8% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 24.7% a year.
- FDX trades at 17.8 times its last year's earnings, against a median of 32.0 for 17 profitable Freight companies.
- Over the past year the price sat below the model fair value on 91% of trading days. The gap ranged from 14% below to 33% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind FDX's fair value · What prices assume · Other companies