FedEx Sells Supply Chain Unit for $1.4B, Margin Recovery Doubts Persist
FDX•FedEx agreed to sell its supply chain unit to CMA CGM for $1.4 billion, divesting contract logistics services to focus on express shipping. Despite a non-GAAP Q4 EPS beat, GAAP margin compression and lack of visible margin recovery cast doubt on meeting 2026 profitability targets and justify a fair value range of $345–$355.
1. Supply Chain Unit Sale
FedEx agreed to sell its global supply chain solutions unit to CMA CGM for $1.4 billion, divesting contract logistics services and sharpening focus on its express delivery business.
2. Q4 EPS Beat and Margin Compression
In Q4, FedEx posted a non-GAAP EPS beat driven by operational efficiencies, but GAAP operating margins narrowed compared with the prior year, spotlighting cost pressures and raising questions about sustainable profitability.
3. Guidance and Valuation Outlook
Management’s fiscal 2026 EPS growth target assumes significant margin expansion that has not yet materialized, and valuation models point to a fair value between $345 and $355, suggesting limited share-price upside until margins improve.
