Do You Believe in the Upside Potential of FedEx Corporation (FDX)?

Ariel Investments, an investment management company, released its “Ariel Global Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. Global equities rallied in the third quarter, driven by AI enthusiasm, resilient corporate earnings, the first U.S. rate cut of the year, and targeted policy easing across key regions. Against this backdrop, the Ariel Global fund traded +4.99% higher in the quarter, compared to the +7.62% return of the MSCI ACWI Index and +6.13% return of the MSCI ACWI Value Index. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Ariel Global Fund highlighted stocks such as FedEx Corporation (NYSE:FDX). Founded in 1971, FedEx Corporation (NYSE:FDX) provides transportation, e-commerce, and business services.  The one-month return of FedEx Corporation (NYSE:FDX) was 9.89%, and its shares lost 8.66% of their value over the last 52 weeks. On November 18, 2025, FedEx Corporation (NYSE:FDX) stock closed at $263.08 per share, with a market capitalization of $62.075 billion.

Ariel Global Fund stated the following regarding FedEx Corporation (NYSE:FDX) in its third quarter 2025 investor letter:

“We addedFedEx Corporation (NYSE:FDX), a global leader in package delivery, operating in a stable, competitive market alongside UPS. Despite macro uncertainty, under new leadership the company has made progress improving margins through cost efficiencies. A major catalyst is the planned spin-off of FedEx Freight (LTL) by June 2026, which could unlock significant value given LTL peers trade at much higher valuations. This move also will allow FedEx to sharpen its focus on the core delivery business, where margin improvements could help close the gap with UPS. Additional catalysts include the upcoming anniversary of the United States Postal Service contract termination in October 2025, clarity on tariffs, and a potential cyclical recovery. While risks such as economic slowdown and tariff impacts remain, we think FedEx offers upside through operational improvements, portfolio simplification, and the potential for a re-rating as investor confidence builds.”

Should You Buy FedEx Corporation (FDX) for its Dividend?

FedEx Corporation (NYSE:FDX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 67 hedge fund portfolios held FedEx Corporation (NYSE:FDX) at the end of the second quarter, up from 62 in the previous quarter. In the first quarter of 2026, FedEx Corporation’s (NYSE:FDX) revenue increased by 3% year-over-year, driven by strength in its U.S. domestic package services. While we acknowledge the risk and potential of FedEx Corporation (NYSE:FDX) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FedEx Corporation (NYSE:FDX) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered FedEx Corporation (NYSE:FDX) and shared the list of stocks Jim Cramer discussed. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.