Shares of FedEx Corp (NYSE: FDX) are trading up this morning after the logistics company raised dividend and announced a few changes to its structure.
FedEx raises dividend by 10%
On Wednesday, the multinational increased its annual payout by 10% to $5.04, as per the press release. That spoke volumes about the company’s confidence in its future.
FedEx also reiterated its commitment to driving efficiencies at its investor event today. To that end, it’s integrating FedEx Express, FedEx Ground, and FedEx Services – the three businesses that it said will now operate as a single unit.
LTL or less-than-truckload, though, will continue to be separate business. Last month, the Memphis-headquartered firm raised its profit guidance for the full year as Invezz reported HERE.
FedEx stock is up nearly 30% for the year at writing.
FedEx stock has upside to $305
In March, Bank of America analyst Ken Hoexter recommended again that investors buy FedEx stock and raised his price target to $305. That implies about a 25% upside from here.
The logistics giant is committed to $4.0 billion in savings by its fiscal year 2025. Earlier this year, the company announced plans of laying off more than 10% of its officers and directors. According to Hoexter:
This is a major structural effort in its DRIVE 2025 $4.0 billion cost reduction plan.
Following FedEx announcement today, the stock pays a dividend yield of just over 2.0% that makes up for another great reason to own it.
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