FedEx Freight Spins Off and Begins Trading as Independent Entity
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 01 2026
0mins
Source: Newsfilter
- Spin-Off Launch: FedEx Freight will complete its spinoff from FedEx Corp on Monday, starting to trade on the New York Stock Exchange under the symbol 'FDXF', marking its operation as the largest less-than-truckload service provider in the U.S. as an independent entity.
- Market Recovery: This debut occurs as freight rates may be emerging from a four-year slump, partly due to several operators exiting the market due to financial losses and federal regulators pushing to restrict commercial driver licenses to U.S. citizens only, creating market opportunities for the new company.
- Profit Potential: BMO Capital Markets analyst Fadi Chamoun noted that as a newly separated entity, FedEx Freight has significant margin improvement opportunities, though this is highly dependent on management's execution, particularly in enhancing service quality and revenue per shipment.
- Medium-Term Growth Outlook: CFO Marshall Witt stated that the company expects average revenue growth of 4% to 6% and core profit growth of 10% to 12% in the medium term, although short-term profits will be dampened by modernization investments and spinoff costs, long-term margin strength is anticipated through cost controls and automation.
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Analyst Views on XPO
Wall Street analysts forecast XPO stock price to fall
19 Analyst Rating
15 Buy
3 Hold
1 Sell
Moderate Buy
Current: 201.790
Low
90.00
Averages
155.22
High
171.00
Current: 201.790
Low
90.00
Averages
155.22
High
171.00
About XPO
XPO, Inc. is a provider of freight transportation services. The Company uses its proprietary technology to move goods through its customers supply chains in North America and Europe. It operates through two segments: North American Less-Than-Truckload (LTL), and European Transportation. The North American LTL segment provides shippers with geographic density and day-definite domestic and cross-border services to the United States (U.S.), as well as Mexico, Canada, and the Caribbean. It also includes trailer manufacturing operations. The European Transportation segment offers a range of services, such as truckload, LTL, full truckload brokerage, warehousing, managed transportation, last mile, freight forwarding, and multimodal solutions. It serves a base of customers in consumer, trade, and industrial markets. The Company offers XPO Smart, its proprietary suite of intelligent tools and analytics that self-adjusts site by site to drive productivity across LTL service center operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strategic Transformation: CEO Raj Subramaniam's four strategic priorities since 2022 focus on high-margin verticals, driving growth in healthcare, automotive, aerospace, and data center markets, which collectively represent a $130 billion market opportunity.
- Independent Operational Advantages: Following the June 1 spinoff of its Freight business, FedEx Freight is projected to generate $8.7 billion in revenue and achieve an adjusted operating margin of around 12% by fiscal 2028, allowing for greater flexibility in improving customer service and productivity.
- Market Competitiveness: Despite Amazon's expansion in logistics, FedEx continues to gain market share in the U.S. through its comprehensive transportation network and superior weekend delivery services, showcasing its resilience in a competitive landscape.
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- High Debt Risk: With a net debt-to-EBITDA ratio of 8x, Genesco may be forced to raise capital under unfavorable terms if market conditions deteriorate, further weakening its financial stability and investor confidence in the long term.
- XPO's Lackluster Growth: XPO (NYSE:XPO) has shown only 2.8% annual growth over the past two years, below industry averages, and its low gross margin of 19.8% reflects competitive pressures and high production costs, limiting profitability and shareholder returns.
- Restricted Free Cash Flow: XPO's free cash flow margin of just 1.6% restricts its ability to invest or reward shareholders with increased buybacks or dividends, leading to diminished investor confidence in its future performance, with a stock price of $216.44 and a forward P/E ratio of 44.8.
See More
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- Oil Price Surge: Crude oil prices rose over 2% due to escalating tensions in the Middle East, which not only exacerbated losses in stocks and bonds but also pressured airline and trucking companies, highlighting the profound impact of energy price fluctuations on the overall market.
- Stable Inflation Data: The US May Consumer Price Index rose 4.2% year-over-year, in line with expectations, while core CPI increased by 2.9%, alleviating some inflation concerns, although rising oil prices may reignite scrutiny over inflationary pressures.
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See More
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- Pressure on Airlines and Transport: Trucking companies are under pressure as Amazon expanded its LTL freight service, with Old Dominion Freight Line and FedEx Freight down over 4% and 3% respectively, indicating growing concerns about increased competition in the transportation sector.
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