Baird lowers FedEx target, says buy on earnings selloff

Baird analyst Garrett Holland lowered the firm’s price target on FedEx to $320 from $340 and keeps an Outperform rating on the shares. The analyst recommends buying the shares on the post-earnings selloff. The fiscal Q1 report was much weaker than expected, and the first half of fiscal 2025 is “clearly challenging,” the analyst tells investors in a research note. The firm says that while cost savings should build through the year and pricing remains favorable, investors are likely skeptical of the smaller revision to FedEx’s fiscal 2025 guidance at the midpoint. Baird recommends using “resurfacing fear” to build positions in the stock as it expects a “value-unlocking conclusion” to the less-than-truckload strategic review by year end, some cyclical tailwind ahead in 2025, and solid execution on structural margin levers over the next few years.