FedEx Corporation (NYSE: FDX) and Expeditors International of Washington (NASDAQ:EXPD) are both large-cap transportation companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitabiliy, valuation and earnings.
Insider & Institutional Ownership
76.5% of FedEx Corporation shares are held by institutional investors. Comparatively, 94.2% of Expeditors International of Washington shares are held by institutional investors. 8.7% of FedEx Corporation shares are held by insiders. Comparatively, 0.8% of Expeditors International of Washington shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
FedEx Corporation pays an annual dividend of $2.00 per share and has a dividend yield of 0.9%. Expeditors International of Washington pays an annual dividend of $0.84 per share and has a dividend yield of 1.5%. FedEx Corporation pays out 18.1% of its earnings in the form of a dividend. Expeditors International of Washington pays out 35.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. FedEx Corporation has raised its dividend for 7 consecutive years and Expeditors International of Washington has raised its dividend for 22 consecutive years. Expeditors International of Washington is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of recent ratings and price targets for FedEx Corporation and Expeditors International of Washington, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Expeditors International of Washington||2||4||2||0||2.00|
FedEx Corporation currently has a consensus target price of $221.88, suggesting a potential upside of 1.54%. Expeditors International of Washington has a consensus target price of $57.25, suggesting a potential upside of 0.56%. Given FedEx Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe FedEx Corporation is more favorable than Expeditors International of Washington.
Risk & Volatility
FedEx Corporation has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500. Comparatively, Expeditors International of Washington has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500.
Earnings & Valuation
This table compares FedEx Corporation and Expeditors International of Washington’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|FedEx Corporation||$60.32 billion||0.98||$8.01 billion||$11.06||19.76|
|Expeditors International of Washington||$6.22 billion||1.65||$711.85 million||$2.35||24.23|
FedEx Corporation has higher revenue and earnings than Expeditors International of Washington. FedEx Corporation is trading at a lower price-to-earnings ratio than Expeditors International of Washington, indicating that it is currently the more affordable of the two stocks.
This table compares FedEx Corporation and Expeditors International of Washington’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Expeditors International of Washington||6.87%||23.01%||15.25%|
FedEx Corporation beats Expeditors International of Washington on 9 of the 17 factors compared between the two stocks.
About FedEx Corporation
FedEx Corporation (FedEx) provides a portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the FedEx brand. The Company’s segments include FedEx Express, TNT Express, FedEx Ground, FedEx Freight and FedEx Services. The FedEx Express segment offers a range of the United States domestic and international shipping services for delivery of packages and freight. TNT Express segment collects, transports and delivers documents, parcels and freight on a day-definite or time-definite basis. The FedEx Ground segment provides business and residential money-back guaranteed ground package delivery services. The FedEx Freight segment offers less-than-truckload (LTL) freight services. The FedEx Services segment provides its other companies with sales, marketing, information technology, communications, customer service and other back-office support.
About Expeditors International of Washington
Expeditors International of Washington, Inc. is a logistics company. The Company is a third-party logistics provider, and purchases cargo space from carriers, including airlines and ocean shipping lines on a volume basis and resells that space to its customers. The Company provides a range of customer solutions, such as order management, time-definite transportation, warehousing and distribution, temperature-controlled transit, cargo insurance and customized logistics solutions. In addition, the Company’s Project Cargo unit handles special project shipments that move through a single method or combination of air, ocean, and/or ground transportation. The Company’s services include airfreight services, ocean freight and ocean services, and customs brokerage and other services. The Company operates along five geographic areas: the Americas; North Asia; South Asia; Europe, and the Middle East, Africa and India.
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