Is FedEx (FDX) Fairly Priced After Strong Share Gains And Cash Flow Outlook?

Simply Wall St

Fri, February 13, 2026 at 2:10 PM GMT+9 4 min read

In this article:

FDX

+0.63%

Make better investment decisions with Simply Wall St’s easy, visual tools that give you a competitive edge.

If you are wondering whether FedEx's current share price really lines up with its underlying worth, you are not alone. This article is built to help you assess that.

FedEx shares last closed at US$369.46, with returns of 1.5% over the past week, 19.3% over the past month, 26.0% year to date and 43.7% over the past year, plus 86.2% over three years and 59.1% over five years.

Recent FedEx headlines have focused on the company as a bellwether for global shipping volumes and parcel demand, as well as its role in broader logistics trends. These themes give useful context for thinking about how the stock's past returns and current price might relate to expectations built into the market.

On Simply Wall St's 6 point valuation checklist, FedEx currently scores 3 out of 6. Next we will look at what different valuation approaches say about that number, and then finish with a framework that can help you judge whether those models really fit how you think about value.

FedEx delivered 43.7% returns over the last year. See how this stacks up to the rest of the Logistics industry.

Approach 1: FedEx Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model takes projected future cash flows and discounts them back to today, aiming to estimate what the business might be worth based on those cash flows alone.

For FedEx, the model used is a 2 Stage Free Cash Flow to Equity approach, built on last twelve month free cash flow of about $3.6b. Analysts provide explicit forecasts for several years, then Simply Wall St extrapolates further, with projected free cash flow of about $7.1b in 2035. These yearly cash flows are discounted back to today using a required return, which is why the discounted values in later years are lower than the raw projections.

Putting all of this together, the DCF model arrives at an estimated intrinsic value of about $405.56 per share. Compared with the recent share price of $369.46, this implies the stock is trading at an 8.9% discount to that DCF estimate. This is a relatively small gap and suggests the market price is broadly in line with this cash flow based valuation.

Result: ABOUT RIGHT

FedEx is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment’s notice. Track the value in your watchlist or portfolio and be alerted on when to act.

FDX Discounted Cash Flow as at Feb 2026

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for FedEx.

Approach 2: FedEx Price vs Earnings

For profitable companies, the P/E ratio is a useful way to think about value because it links what you pay per share directly to the earnings the business is generating today. Investors usually accept a higher or lower P/E depending on what they expect for future growth and how much risk they see in those earnings.

Story continues  

FedEx currently trades on a P/E of 20.1x. That sits above the Logistics industry average of about 16.7x, and below the peer group average of 22.2x. Simply Wall St also calculates a Fair Ratio for FedEx of 21.9x, which is the P/E level that might be expected given factors like the company’s earnings growth profile, industry, profit margins, market cap and risk characteristics.

This Fair Ratio is more tailored than a simple comparison with peers or the sector because it adjusts for company specific traits instead of assuming all businesses in the group deserve the same multiple. With FedEx’s actual P/E of 20.1x sitting below the Fair Ratio of 21.9x, the shares appear modestly undervalued on this metric.

Result: UNDERVALUED

NYSE:FDX P/E Ratio as at Feb 2026

P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 23 top founder-led companies.

Upgrade Your Decision Making: Choose your FedEx Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce Narratives, a simple way for you to link your view of FedEx’s story to a forecast and then to a fair value. You can set your own assumptions for revenue, earnings, margins and P/E, compare the resulting fair value with today’s price, and see how your view sits alongside the most optimistic FedEx Narrative on Simply Wall St, which currently points to a fair value of about US$365 and uses a higher future P/E of 18.69x. You can also compare it with the most cautious Narrative, which points to a fair value of about US$233.77 with a lower future P/E of 12.51x. All of this is updated automatically on the Community page when new news or earnings arrive.

Do you think there’s more to the story for FedEx? Head over to our Community to see what others are saying!

NYSE:FDX 1-Year Stock Price Chart

_ This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._

Companies discussed in this article include FDX.

Have feedback on this article? Concerned about the content? Get in touch with us directly._ Alternatively, email editorial-team@simplywallst.com_

Terms and Privacy Policy

Privacy Dashboard

More Info