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FedEx (FDX) Rewards Shareholders With 10% Dividend Hike

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In a shareholder-friendly move, FedEx Corporation (FDX - Free Report) announced a hike in its dividend payout. FDX’s board of directors has approved a dividend hike of 10%, thereby raising its quarterly cash dividend from $1.15 ($4.60 annualized) per share to $1.26 ($5.04 annualized).

The raised dividend is anticipated to be paid out on Jul 3, 2023, to shareholders of record at the close of business on Jun 12, 2023. The move reflects FDX’s intention to utilize free cash to enhance its shareholders’ returns.

FedEx Corporation Dividend Yield (TTM)

 

FedEx Corporation Dividend Yield (TTM)

FedEx Corporation dividend-yield-ttm | FedEx Corporation Quote

FedEx has been consistently making efforts to reward its shareholders through dividends and share buybacks, which are encouraging. In June 2022, FedEx raised its quarterly dividend by 53% to $1.15 per share.

In the first nine months of fiscal 2023, FedEx paid out dividends worth $888 million (higher than the $598 million dividend payout in the first nine months of fiscal 2022). In fiscal 2022, FedEx paid out dividends worth $793 million (higher than the $686 million dividend payout in fiscal 2021). Such shareholder-friendly moves indicate the company’s commitment to creating value for shareholders and underline its confidence in its business. These initiatives not only instill investors’ confidence but positively impact earnings per share.

Dividend-paying stocks provide a solid income stream and have fewer chances of experiencing wild price swings. Dividend stocks, like FDX, are safe bets for creating wealth, as the payouts generally act as a hedge against economic uncertainty like the current scenario. 

FDX management’s decision to increase its quarterly dividend payout reflects its commitment toward boosting shareholder value apart from underlining confidence in its business. We believe, such shareholder-friendly initiatives boost investors’ confidence and positively impact the company’s bottom line.

Zacks Rank and Other Stocks to Consider

Currently, FedEx carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks from the Zacks Transportation sector are Copa Holdings, S.A. (CPA - Free Report) and American Airlines (AAL - Free Report) . Copa Holdings presently sports a Zacks Rank #1 (Strong Buy) and American Airlines carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Copa Holdings has an expected earnings growth rate of 39.83% for the current year. CPA delivered a trailing four-quarter earnings surprise of 33.35%, on average.

The Zacks Consensus Estimate for CPA’s current-year earnings has improved 21.1% over the past 90 days. Shares of CPA have risen 20.7% over the past six months.

AAL has an expected earnings growth rate of more than 100% for the current year. AAL delivered a trailing four-quarter earnings surprise of 7.79%, on average.

The Zacks Consensus Estimate for AAL’s current-year earnings has improved 31.1% over the past 90 days. Shares of AAL have gained 11.2% over the past six months.


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