FedEx stock (NYSE: FDX) currently trades at $262 per share, 8% below the level seen in March 2021, and it has little room for growth, in our view. FDX stock was trading at around $227 in early June 2022, just before the Fed started increasing rates, and is now 15% above that level, compared to 14% gains for the S&P 500 during this period. The rally in the stock over recent months has been driven by a steady decline in the inflation rate in response to the Fed’s aggressive rate hike plan – although investors still have concerns about a potential recession.
Interestingly, FDX stock has had a Sharpe Ratio of 0.3 since early 2017, lower than 0.6 for the S&P 500 Index over the same period. This compares with the Sharpe of 1.3 for the Trefis Reinforced Value portfolio. Sharpe is a measure of return per unit of risk, and high-performance portfolios can provide the best of both worlds.
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