Financial statement analysis and common stock valuation

Analysis of Solvency Ratios

Examines FedEx Corp. capital structure in terms of the mix of its financing sources and the ability of the firm to satisfy its longer-term debt and investment obligations.

• Solvency Ratios (Summary)
• Debt to Equity
• Debt to Equity (including Operating Lease Liability)
• Debt to Capital
• Debt to Capital (including Operating Lease Liability)
• Debt to Assets
• Debt to Assets (including Operating Lease Liability)
• Financial Leverage
• Interest Coverage
• Fixed Charge Coverage

Common Stock Valuation Ratios

Relative valuation technique determine the value of FedEx Corp. by comparing it to similar entities (like industry or sector) on the basis of several relative ratios that compare its stock price to relevant variables that affect the stock value, such as earnings, book value, and sales.

• Current Valuation Ratios
• Historical Valuation Ratios (Summary)
• Price to Earnings (P/E)
• Price to Operating Profit (P/OP)
• Price to Sales (P/S)
• Price to Book Value (P/BV)

Balance Sheet: Assets

The assets reports major classes and amounts of resources owned or controlled by FedEx Corp..

Statement of Comprehensive Income

Comprehensive income is the change in equity (net assets) of FedEx Corp. during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.

Dividend Discount Model (DDM)

The dividend discount model (DDM) is a technique for estimating the value of a share of FedEx Corp. common stock issue as the present value of all future dividends.

• Intrinsic Stock Value (Valuation Summary)
• Required Rate of Return (r)
• Dividend Growth Rate (g)

Capital Asset Pricing Model (CAPM)

CAPM is a theory concentrated with deriving the expected rates of return on risky assets based on the assets’ systematic risk levels. Systematic risk is the variability of returns that is due to macroeconomic factors that affect all risky assets. It cannot be eliminated by diversification.

• Rates of Return
• Variance and Covariance
• Systematic Risk (β) Estimation
• Expected Rate of Return

Common-Size Income Statement

Income statement components (revenues and expenses) shown as percentage of total sales.

Analysis of Profitability Ratios
Quarterly Data

Measures the income of FedEx Corp. relative to its revenues and invested capital.

• Profitability Ratios (Summary)
• Operating Profit Margin
• Net Profit Margin
• Return on Equity (ROE)
• Return on Assets (ROA)

Analysis of Geographic Areas

FedEx Corp. operates in 2 regions: U.S. and International.

• Area Asset Turnover
• Revenue
• Noncurrent assets

Analysis of Long-term (Investment) Activity Ratios
Quarterly Data

Measures how efficiently FedEx Corp. generates revenues from its investments in fixed or total assets.

• Long-term Activity Ratios (Summary)
• Net Fixed Asset Turnover
• Total Asset Turnover
• Equity Turnover

Common-Size Income Statement
Quarterly Data

Income statement components (revenues and expenses) shown as percentage of total sales.

Cash Flow Statement

The cash flow statement provides information about FedEx Corp. cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on FedEx Corp. balance sheet.