June 04, 2025 a 07:31 am
FDX: Dividend Analysis - FedEx Corporation
📊 FedEx Corporation, a global leader in logistics and transportation, presents a strong dividend profile characterized by a stable yield and an impressive history of payouts. Although the current yield stands at 2.24%, FedEx has consistently increased its dividends over the years, demonstrating a commitment to returning capital to shareholders. With a robust financial foundation, FedEx effectively manages its payout ratios to ensure sustainability and growth.
Overview
📈 As a major player in the Transportation sector, FedEx exhibits a dividend yield of 2.24%, underpinning a dividend per share of $5.08. Having sustained its dividend payments for 24 years with no recent cuts or suspensions, FedEx's dividend history reflects a strong commitment to shareholder returns.
| Metric | Details |
|---|---|
| Sector | Transportation |
| Dividend Yield | 2.24% |
| Current Dividend per Share | $5.08 |
| Dividend History | 24 years |
| Last Cut or Suspension | None |
Dividend History
📅 FedEx’s dividend history illustrates consistency and growth, which is crucial for income-focused investors. This track record assures stakeholders of predictable returns and resilience against market fluctuations.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | $1.38 |
| 2024 | $5.40 |
| 2023 | $4.93 |
| 2022 | $4.20 |
| 2021 | $2.90 |
Dividend Growth
📈 FedEx has shown moderate yet stable dividend growth, essential for protecting purchasing power against inflation. Over the past 3 years, dividend growth has been 0.23%, while the 5-year growth rate stands at 0.16%.
| Time | Growth |
|---|---|
| 3 years | 0.23% |
| 5 years | 0.16% |
The average dividend growth is 0.16% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio
🗣️ Payout ratios are pivotal in assessing dividend sustainability. FedEx’s EPS-based payout ratio is 31.10%, while the free cash flow-based payout ratio is 35.45%, indicating efficient management of cash flows and dividends.
| Key figure | Ratio |
|---|---|
| EPS-based | 31.10% |
| Free Cash Flow-based | 35.45% |
The EPS and FCF payout ratios demonstrate FedEx’s cautious approach to balancing earnings distribution with reinvestment flexibility.
Cashflow & Capital Efficiency
💧 FedEx’s capital efficiency is illustrated through metrics such as Free Cash Flow Yield and CAPEX to Operating Cash Flow ratios, which are vital for evaluating cash flow stability and capital returns.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 4.98% | 4.77% | 5.20% |
| Earnings Yield | 6.88% | 7.17% | 6.48% |
| CAPEX to Op. Cash Flow | 62.27% | 70.04% | 68.79% |
| Stock-based Comp. to Revenue | 0.18% | 0.20% | 0.20% |
| Free Cash Flow / Op. Cash Flow | 37.73% | 29.96% | 31.21% |
FedEx's stable free cash flow and well-managed capital expenditures highlight its efficient capital utilization, reinforcing its capacity to sustain and progressively increase its dividend.
Balance Sheet & Leverage Analysis
⚠️ A sound balance sheet and leverage assessment reflect FedEx’s financial health and risk profile, as shown by metrics such as Debt-to-Capital and Current Ratio.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 1.37 | 1.47 | 1.49 |
| Debt-to-Assets | 0.43 | 0.44 | 0.43 |
| Debt-to-Capital | 0.58 | 0.60 | 0.60 |
| Net Debt to EBITDA | 3.42 | 2.97 | 3.10 |
| Current Ratio | 1.36 | 1.37 | 1.43 |
| Quick Ratio | 1.32 | 1.33 | 1.38 |
| Financial Leverage | 3.15 | 3.34 | 3.45 |
FedEx has shown prudent leverage management, maintaining a manageable debt level in comparison to its equity and assets, fortifying financial resilience.
Fundamental Strength & Profitability
✅ FedEx’s fundamental strength is affirmed by healthy profitability ratios, crucial for assessing operational efficiency and growth potential.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 15.70% | 15.23% | 15.34% |
| Return on Assets | 4.98% | 4.56% | 4.45% |
| Net Margin | 4.94% | 4.41% | 4.09% |
| EBIT Margin | 7.50% | 7.13% | 6.20% |
| EBITDA Margin | 12.39% | 11.76% | 10.44% |
| Gross Margin | 21.61% | 21.26% | 21.57% |
| R&D to Revenue | 0% | 0% | 0% |
FedEx continuously delivers strong ROE and ROA, supported by solid profit margins, reflecting effective management and strategic growth initiatives.
Price Development
Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 4 | |
| Dividend growth | 3 | |
| Payout ratio | 4 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Overall Score: 31/40
Rating
✅ FedEx Corporation showcases consistent fiscal discipline and a strong dividend profile, meriting a “Buy” recommendation for income-seeking investors prioritizing stability and modest growth.