FedEx Story

FDX -- USA Stock

USD 242.83 6.84 2.74%

Macroaxis Story

FedEx is scheduled to announce its earnings today. The next earnings report is expected on the 16th of March 2021. FedEx PPandE Turnover is fairly stable at the moment as compared to the past year. FedEx reported PPandE Turnover of 2.16 in 2019. Receivables Turnover is likely to rise to 8.66 in 2020, whereas Revenue Per Employee is likely to drop slightly above 269.5 K in 2020. As many investors are getting excited about industrials space, it is fair to break down FedEx as an investment option.

Published over a month ago

View all stories for FedEx | View All Stories

You think FedEx (NYSE:FDX) debt is an issue for investors?

FedEx has 38.03 B in debt with debt to equity (D/E) ratio of 1.95, which is OK given its current industry classification. On a scale of 0 to 100, FedEx holds a performance score of 10. The firm shows a Beta (market volatility) of -0.1222, which means not very significant fluctuations relative to the market. Let's try to break down what FedEx's beta means in this case. As returns on the market increase, returns on owning FedEx are expected to decrease at a much lower rate. During the bear market, FedEx is likely to outperform the market. Although it is vital to follow FedEx historical returns, it is good to be conservative about what you can do with the information regarding equity current trending patterns. The philosophy towards predicting future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By reviewing FedEx technical indicators, you can presently evaluate if the expected return of 0.29% will be sustainable into the future. Please utilizes FedEx maximum drawdown, and the relationship between the information ratio and expected short fall to make a quick decision on whether FedEx price patterns will revert.

FedEx financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of FedEx, including all of FedEx's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of FedEx assets, the company is considered highly leveraged. Understanding the composition and structure of overall FedEx debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding FedEx Total Debt

FedEx liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. FedEx has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on FedEx balance sheet include debt obligations and money owed to different FedEx vendors, workers, and loan providers. Below is the chart of FedEx main long-term debt accounts currently reported on its balance sheet.

You can use FedEx financial leverage analysis tool to get a better grip on understanding its financial position

How important is FedEx's Liquidity

FedEx financial leverage refers to using borrowed capital as a funding source to finance FedEx ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. FedEx financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between FedEx's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for FedEx, but it might be worth checking our own buy vs. sell analysis

FedEx exotic insider transaction detected

Legal trades by FedEx insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:

FedEx insider trading alert for general transaction of common stock by Frederick Smith, ChairmanCEO, on 10th of January 2021. This event was filed by Fedex Corp with SEC on 2021-01-07. Statement of changes in beneficial ownership - SEC Form 4. Frederick Smith currently serves as chairman of the board, chief executive officer of FedEx [view details]

Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Details

The entity reported the last year's revenue of 71.49 B. Total Income to common stockholders was 1.78 B with profit before taxes, overhead, and interest of 16.84 B.

Asset Breakdown

47.8 B

Assets Non Current

Goodwill

15.1 B

Current Assets

	Total Assets	62.92 Billion
	Current Assets	15.11 Billion
	Assets Non Current	47.81 Billion
	Goodwill	6.01 Billion
	Tax Assets	476.91 Million

FedEx may start a correction in January

Current Total Risk Alpha is up to 0.09. Price may slide again. FedEx currently demonstrates below-verage downside deviation. It has Information Ratio of 0.09 and Jensen Alpha of 0.31. However, we do advice investors to further question FedEx expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

While some other companies under the integrated freight & logistics industry are still a bit expensive, FedEx may offer a potential longer-term growth to investors. With a relatively neutral outlook on the current economy, it is better to hold off any trading of FedEx as the current risk-reward utility is not appealing enough. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to FedEx.

About Contributor

Achuva Shats is a Member of Macroaxs Editorial Board. Achuva writes about retail product and service companies from the perspective of a regular consumer and sophisticated investor at the same time. She is passionate about corporate ethics and equality in the workforce View Profile

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of FedEx. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com

Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions

Feedback Blog

Made with optimal in San Francisco

2021 Macroaxis LLC