Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

FedEx Corp. (NYSE:FDX)

Return on Capital (ROC)

Advanced level

Return on capital (ROC) is after tax rate of return on net business assets. ROIC is unaffected by changes in interest rates or company’s debt and equity structure. It measures business productivity performance.


Return on Invested Capital (ROIC)

FedEx Corp., ROIC calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 2,531  1,216  5,220  4,641  2,507  1,043 
Invested capital2 57,553  53,043  53,524  48,318  43,814  36,281 
Performance Ratio
ROIC3 4.40% 2.29% 9.75% 9.60% 5.72% 2.88%
Benchmarks
ROIC, Competitors4
CSX Corp. 11.99% 12.00% 7.93% 7.82% 9.14%
Norfolk Southern Corp. 10.06% 9.68% 8.75% 6.96% 6.98%
Union Pacific Corp. 12.84% 12.47% 11.19% 10.44% 11.43%
United Parcel Service Inc. 14.07% 19.12% 22.35% 19.20% 29.60%

Based on: 10-K (filing date: 2020-07-20), 10-K (filing date: 2019-07-16), 10-K (filing date: 2018-07-16), 10-K (filing date: 2017-07-17), 10-K (filing date: 2016-07-18), 10-K (filing date: 2015-07-14).

1 NOPAT. See details »

2 Invested capital. See details »

3 2020 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 2,531 ÷ 57,553 = 4.40%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. FedEx Corp.’s ROIC deteriorated from 2018 to 2019 but then slightly improved from 2019 to 2020.

Decomposition of ROIC

FedEx Corp., decomposition of ROIC

Microsoft Excel LibreOffice Calc
ROIC = OPM1 × TO2 × 1 – CTR3
May 31, 2020 4.40% = 4.03% × 1.20 × 90.71%
May 31, 2019 2.29% = 2.35% × 1.31 × 74.19%
May 31, 2018 9.75% = 8.39% × 1.22 × 95.05%
May 31, 2017 9.60% = 9.35% × 1.25 × 82.30%
May 31, 2016 5.72% = 7.14% × 1.15 × 69.71%
May 31, 2015 2.88% = 5.13% × 1.31 × 42.83%

Based on: 10-K (filing date: 2020-07-20), 10-K (filing date: 2019-07-16), 10-K (filing date: 2018-07-16), 10-K (filing date: 2017-07-17), 10-K (filing date: 2016-07-18), 10-K (filing date: 2015-07-14).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the increase in return on invested capital (ROIC) over 2020 year is the increase in profitability measured by operating profit margin (OPM) ratio.


Operating Profit Margin (OPM)

FedEx Corp., OPM calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 2,531  1,216  5,220  4,641  2,507  1,043 
Add: Cash operating taxes2 259  423  272  998  1,089  1,392 
Net operating profit before taxes (NOPBT) 2,790  1,639  5,492  5,639  3,597  2,435 
 
Revenue 69,217  69,693  65,450  60,319  50,365  47,453 
Profitability Ratio
OPM3 4.03% 2.35% 8.39% 9.35% 7.14% 5.13%
Benchmarks
OPM, Competitors4
CSX Corp. 42.19% 40.49% 32.47% 30.23% 31.42%
Norfolk Southern Corp. 36.44% 35.37% 35.12% 32.06% 28.64%
Union Pacific Corp. 40.69% 38.05% 39.75% 38.00% 38.59%
United Parcel Service Inc. 8.61% 9.36% 11.69% 9.16% 13.28%

Based on: 10-K (filing date: 2020-07-20), 10-K (filing date: 2019-07-16), 10-K (filing date: 2018-07-16), 10-K (filing date: 2017-07-17), 10-K (filing date: 2016-07-18), 10-K (filing date: 2015-07-14).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
OPM = 100 × NOPBT ÷ Revenue
= 100 × 2,790 ÷ 69,217 = 4.03%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. FedEx Corp.’s OPM deteriorated from 2018 to 2019 but then slightly improved from 2019 to 2020.

Turnover of Capital (TO)

FedEx Corp., TO calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015
Selected Financial Data (US$ in millions)
Revenue 69,217  69,693  65,450  60,319  50,365  47,453 
Invested capital1 57,553  53,043  53,524  48,318  43,814  36,281 
Efficiency Ratio
TO2 1.20 1.31 1.22 1.25 1.15 1.31
Benchmarks
TO, Competitors3
CSX Corp. 0.34 0.36 0.35 0.34 0.39
Norfolk Southern Corp. 0.32 0.34 0.32 0.30 0.33
Union Pacific Corp. 0.38 0.40 0.39 0.37 0.41
United Parcel Service Inc. 2.04 2.25 2.26 3.05 3.06

Based on: 10-K (filing date: 2020-07-20), 10-K (filing date: 2019-07-16), 10-K (filing date: 2018-07-16), 10-K (filing date: 2017-07-17), 10-K (filing date: 2016-07-18), 10-K (filing date: 2015-07-14).

1 Invested capital. See details »

2 2020 Calculation
TO = Revenue ÷ Invested capital
= 69,217 ÷ 57,553 = 1.20

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. FedEx Corp.’s TO improved from 2018 to 2019 but then deteriorated significantly from 2019 to 2020.

Effective Cash Tax Rate (CTR)

FedEx Corp., CTR calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
May 31, 2020 May 31, 2019 May 31, 2018 May 31, 2017 May 31, 2016 May 31, 2015
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 2,531  1,216  5,220  4,641  2,507  1,043 
Add: Cash operating taxes2 259  423  272  998  1,089  1,392 
Net operating profit before taxes (NOPBT) 2,790  1,639  5,492  5,639  3,597  2,435 
Tax Rate
CTR3 9.29% 25.81% 4.95% 17.70% 30.29% 57.17%
Benchmarks
CTR, Competitors4
CSX Corp. 17.12% 17.21% 29.78% 24.96% 24.68%
Norfolk Southern Corp. 13.84% 18.57% 21.16% 28.15% 25.45%
Union Pacific Corp. 16.87% 18.82% 26.90% 26.21% 28.34%
United Parcel Service Inc. 19.83% 9.23% 15.59% 31.24% 27.12%

Based on: 10-K (filing date: 2020-07-20), 10-K (filing date: 2019-07-16), 10-K (filing date: 2018-07-16), 10-K (filing date: 2017-07-17), 10-K (filing date: 2016-07-18), 10-K (filing date: 2015-07-14).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2020 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 259 ÷ 2,790 = 9.29%

4 Click competitor name to see calculations.

Tax rate Description The company
CTR Effective cash tax rate on operating income. FedEx Corp.’s CTR increased from 2018 to 2019 but then slightly decreased from 2019 to 2020 not reaching 2018 level.