5 Best Stock Picks of Mason Hawkins’ Southeastern Asset Management

4. FedEx Corporation (NYSE:FDX)

Southeastern Asset Management’s Stake Value: $374,336,000

Percentage of Southeastern Asset Management’s 13F Portfolio: 6.28%

Number of Hedge Fund Holders: 64

FedEx Corporation (NYSE:FDX) is an American multinational conglomerate based in Memphis, Tennessee, offering transportation, e-commerce, and business services. Mason Hawkins’ Southeastern Asset Management portfolio had 1.4 million FedEx Corporation (NYSE:FDX) shares, worth $374.3 million, representing 6.28% of the total investments. The hedge fund increased its FedEx Corporation (NYSE:FDX) stake by 27% in Q4 2021. 

On March 29, Morgan Stanley analyst Ravi Shanker said the promotion of Raj Subramaniam, current President and COO, to President and CEO is “not likely to surprise the market at all” since there has been some speculation on a succession plan for a few years now. He maintained an Equal Weight rating and a $250 price target on FedEx Corporation (NYSE:FDX) shares.

Among the hedge funds tracked by Insider Monkey, 64 funds reported owning stakes in FedEx Corporation (NYSE:FDX) at the end of December 2021, worth about $2.5 billion. Bill & Melinda Gates Foundation Trust is a prominent shareholder of the company, with 1.4 million shares worth $386.3 million. 

Here is what Artisan Value Fund has to say about FedEx Corporation (NYSE:FDX) in its Q3 2021 investor letter:

“Our weakest Q3 performers included FedEx. Shares of FedEx Corporation (NYSE:FDX), a global shipping and logistics firm, were held back by disappointing business results as labor cost headwinds and air network disruptions overshadowed solid top-line trends. We think the company should be able to overcome these near-term issues. Importantly, FedEx Corporation (NYSE:FDX) has strong pricing power as it operates in a consolidated global shipping industry. In September, the company announced it would increase its shipping rates by an average of 5.9% across most of its services, which is the first time in several years that its annual increase would exceed 5.0%. The industry’s renewed pricing discipline is a welcome change, reflecting a broader commitment to earn better returns on invested capital. FedEx Corporation (NYSE:FDX) is also closer to fully integrating TNT, a European-focused parcel company it acquired in 2016. The market is beginning to incorporate a higher probability FedEx will fully integrate TNT, which will provide a significant boost to profits. The stock now trades at a near-trough multiple of less than 12X 2022 earnings, so we added to our position on weakness.”