FedEx Corp
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| WPJ | LOCK|SFK^ | LOCK|!t@c&!m |
FedEx's Ground Volumes Still Lackluster, but Margin Gains Resume
Business Strategy and Outlook
Overnight delivery pioneer FedEx is one of three large national carriers that dominate the for-hire parcel delivery landscape—FedEx and UPS are the major US incumbents, while DHL Express leads Europe. FedEx is also the largest US less-than-truckload carrier, which helps forge sticky relationships with retail and industrial shippers on the package side. UPS has been around much longer in the US ground market, forging a density advantage and higher margins, but FedEx has gradually enhanced its ground positioning over the past decade, with help from its slight speed advantage over UPS and capacity investment.
