DCF Studio

    FDX · NYQ · Industrials

    FedEx Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 190.73

    Market price

    USD 318.25

    Implied upside

    -40.1%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2026-05-31

    Value Per Share

    Perpetuity growth
    USD 190.73-40.1%
    Exit multiple
    USD 278.49-12.5%
    Market price
    USD 318.25

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn2bn5bnFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36
    Nominal FCFFDiscounted to todayUSD
    LineFY27FY28FY29FY30FY31FY32FY33FY34FY35FY36CAGR
    RevenueUSD 91.9bnUSD 95.8bnUSD 99.8bnUSD 103.6bnUSD 107.4bnUSD 111.1bnUSD 114.6bnUSD 118.0bnUSD 121.2bnUSD 124.2bn+3.4%
    EBITUSD 6.2bnUSD 6.5bnUSD 6.7bnUSD 7.0bnUSD 7.2bnUSD 7.5bnUSD 7.7bnUSD 8.0bnUSD 8.2bnUSD 8.4bn+3.4%
    NOPATUSD 4.9bnUSD 5.1bnUSD 5.3bnUSD 5.5bnUSD 5.7bnUSD 5.9bnUSD 6.1bnUSD 6.3bnUSD 6.5bnUSD 6.6bn+3.4%
    Add depreciation & amortisationUSD 4.4bnUSD 4.5bnUSD 4.7bnUSD 4.9bnUSD 5.1bnUSD 5.3bnUSD 5.4bnUSD 5.6bnUSD 5.8bnUSD 5.9bn+3.4%
    Less capital expenditureUSD -4.9bnUSD -5.2bnUSD -5.5bnUSD -5.8bnUSD -6.1bnUSD -6.4bnUSD -6.7bnUSD -7.0bnUSD -7.3bnUSD -7.6bn+5.0%
    Capex, % of revenue5.3%5.4%5.5%5.6%5.7%5.8%5.9%6.0%6.1%6.2%-
    Less increase in working capitalUSD 256.5mUSD -357.2mUSD -353.0mUSD -347.0mUSD -339.2mUSD -329.5mUSD -318.0mUSD -304.6mUSD -289.4mUSD -272.4m-
    Free cashflow to firmUSD 4.6bnUSD 4.1bnUSD 4.2bnUSD 4.3bnUSD 4.3bnUSD 4.4bnUSD 4.5bnUSD 4.5bnUSD 4.6bnUSD 4.6bn-0.0%
    Discount factor0.96260.89190.82640.76570.70950.65740.60910.56440.52290.4845-
    Present valueUSD 4.4bnUSD 3.6bnUSD 3.5bnUSD 3.3bnUSD 3.1bnUSD 2.9bnUSD 2.7bnUSD 2.6bnUSD 2.4bnUSD 2.2bn-
    Present Value Of The ForecastUSD 30.7bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.210Reported 1.314, pulled toward 1.0 (Blume)
    Cost of equity10.01%Risk-free + beta x equity risk premium
    Cost of debt5.44%Risk-free + 55bp, the spread for a AA rating at 6.8x interest cover. Book interest / average debt was lower, at 2.4%.
    Market capitalisationUSD 74.5bn63.4% of capital
    Total debtUSD 42.9bn36.6% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC7.93%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 190.73

    59% of EV

    Forecast FCFF, final year
    USD 4.6bn
    Capex at depreciation, working capital in reinvestment
    USD 6.6bn
    Less reinvestment at g/ROIC (26.4% of NOPAT)
    USD -1.7bn
    Capitalised
    USD 4.9bn
    ROIC (reported)
    9.5%
    Terminal value, undiscounted
    USD 91.9bn
    Terminal value, discounted
    USD 44.5bn
    Enterprise value
    USD 75.2bn
    Less net debt
    USD 29.6bn
    Equity value
    USD 45.6bn

    Exit at 9.5x EBITDA

    Value per shareUSD 278.49

    68% of EV

    Terminal value, undiscounted
    USD 135.2bn
    Terminal value, discounted
    USD 65.5bn
    Enterprise value
    USD 96.2bn
    Less net debt
    USD 29.6bn
    Equity value
    USD 66.6bn

    Spread between methods: 37%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.93%333.91348.41368.24396.11437.03
    6.93%249.01253.33259.42267.96280.03
    7.93%190.68190.42190.73191.78193.82
    8.93%148.17145.74143.43141.26139.28
    9.93%117.35114.50111.65108.80105.95

    Outlined: this model. Green text: above today's price of 318.25. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year1.7%2.7%7.2%
    EBIT margin7.2%6.7%9.3%
    Discount rate-7.9%6.3%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.