July 20, 2025 a 03:31 am
FDX: Dividend Analysis - FedEx Corporation
FedEx Corporation remains a solid player in the logistics sector, maintaining a consistent dividend payment over 24 years. With a healthy dividend yield of 3.04% and no recent cuts, it suggests stability in its payout policy. The company's dividend growth, particularly over 5 years, reflects steady incremental increases, reinforcing its commitment to returning value to shareholders.
📊 Overview
FedEx operates in the competitive logistics and transportation sector, offering a robust dividend profile with a compelling mix of yield and historical growth. The absence of dividend cuts highlights its resilience.
| Sector | Dividend Yield (%) | Current Dividend per Share (USD) | Dividend History (years) | Last Cut or Suspension |
|---|---|---|---|---|
| Logistics | 3.04 | 5.51 | 24 | None |
📈 Dividend History
Historically, FedEx has demonstrated commitment to dividend payments, crucial for evaluating shareholder value over time. Its unbroken history for 24 years emphasizes a strong corporate ethic towards consistent returns.
| Year | Dividend per Share |
|---|---|
| 2025 | 2.83 |
| 2024 | 5.40 |
| 2023 | 4.93 |
| 2022 | 4.20 |
| 2021 | 2.90 |
📈 Dividend Growth
Analyzing dividend growth can provide insights into potential future performance. FedEx’s recent growth rates depict modest yet sustained enhancement of shareholder returns.
| Time | Growth (%) |
|---|---|
| 3 years | 23% |
| 5 years | 15.74% |
The average dividend growth is 15.74% over 5 years. This shows moderate but steady dividend growth.
🗣️ Payout Ratio
Payout ratios provide a measure of dividend sustainability and potential risks. FedEx’s current levels are comfortably manageable, ensuring the continuity of dividends without hampering reinvestment.
| Key Figure | Ratio (%) |
|---|---|
| EPS-based | 32.05% |
| Free Cash Flow-based | 44.29% |
With a 32.05% EPS-based and a 44.29% FCF-based payout ratio, FedEx’s dividends appear well-covered by earnings and cash flows, indicating sustainability.
📊 Cashflow & Capital Efficiency
The analysis of cashflow yields and capital efficiency is vital for sustaining operations and capital expenditures. FedEx manages a solid balance between free cash flow generation and capital spending, ensuring the capability to both maintain and grow dividends.
| Year | Free Cash Flow Yield | Earnings Yield | CAPEX to Operating Cash Flow | Stock-based Compensation to Revenue | Free Cash Flow / Operating Cash Flow Ratio |
|---|---|---|---|---|---|
| 2025 | 5.62% | 7.72% | 57.63% | 0.13% | 42.37% |
| 2024 | 4.98% | 6.88% | 62.27% | 0.19% | 37.73% |
| 2023 | 4.77% | 7.17% | 70.04% | 0.20% | 29.96% |
The solid free cash flow yield combined with prudent CAPEX management highlights FedEx’s efficient capital utilization, supporting stable returns.
🗣️ Balance Sheet & Leverage Analysis
FedEx’s balance sheet metrics are integral for assessing financial health, debt management, and liquidity positions. Stable leverage ratios indicate manageable debt levels in line with assets and equity.
| Year | Debt-to-Equity | Debt-to-Assets | Debt-to-Capital | Net Debt to EBITDA | Current Ratio | Quick Ratio | Financial Leverage |
|---|---|---|---|---|---|---|---|
| 2025 | 133.28% | 42.68% | 57.13% | 1.21 | - | 1.15 | 3.12 |
| 2024 | 136.75% | 43.35% | 57.76% | 2.87 | - | 1.32 | 3.15 |
| 2023 | 146.93% | 44.00% | 59.50% | 2.97 | - | 1.33 | 3.34 |
The leverage analysis illustrates a consistent approach towards maintaining financial strength while engaging in moderate gearing for expansion and operational needs.
⚠️ Fundamental Strength & Profitability
Assessing fundamentals like ROE and margins offer insights into operational efficiency and profitability, which are crucial for long-term dividend stability.
| Year | Return on Equity | Return on Assets | Net Margin | EBIT Margin | EBITDA Margin | Gross Margin | R&D to Revenue |
|---|---|---|---|---|---|---|---|
| 2025 | 14.58% | 4.67% | 4.65% | 6.67% | 11.04% | 26.45% | 0% |
| 2024 | 15.70% | 4.98% | 4.94% | 7.50% | 12.39% | 21.61% | 0% |
| 2023 | 15.23% | 4.56% | 4.41% | 7.13% | 11.76% | 21.26% | 0% |
The consistent ROE and margins highlight FedEx’s effective profitability management, supporting sustainable growth and dividend capabilities.
✅ Price Development
📉 Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend yield | 4 | |
| Dividend Stability | 5 | |
| Dividend growth | 3 | |
| Payout ratio | 4 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 3 | |
| Balance Sheet Quality | 4 |
Overall Score: 32 out of 40
Rating
In conclusion, FedEx Corporation's dividend profile remains attractive for income-focused investors seeking stability and modest growth. The company's consistent payouts, sustainable payout ratios, and strong fundamentals support a 'Buy' recommendation for those valuing reliable income streams with potential for capital appreciation.