Given its better prospects, we believe Target stock (NYSE: TGT) is a better pick than FedEx stock (NYSE: FDX). Although these companies are from different sectors, we compare them because they have a similar market capitalization of $60-65 billion. The decision to invest often comes down to finding the best stocks within the parameters of certain characteristics that suit an investment style. The size of profits can matter, as larger profits can imply greater market power. In the sections below, we discuss why we believe TGT will offer higher returns than FDX in the next three years. We compare a slew of factors, such as historical revenue growth, returns, and valuation, in an interactive dashboard analysis of FedEx vs. Target
TGT
FDX stock has seen little change, moving slightly from levels of $260 in early January 2021 to around $260 now, while TGT stock has faced a notable decline of 25% from levels of $175 in early January 2021 to around $135 now, vs. an increase of about 20% for the S&P 500 over this roughly three-year period.
Overall, the performance of FDX stock with respect to the index has been quite volatile. Returns for the stock were 0% in 2021, -33% in 2022, and 49% in 2023. Similarly, the decrease in TGT stock has been far from consistent, with returns of 31% in 2021, -36% in 2022, and -10% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 19% in 2023 – indicating that FDX underperformed the S&P in 2021 and 2022 and TGT underperformed the S&P in 2022 and 2023.
In fact, consistently beating the S&P 500 – in good times and bad – has been difficult over recent years for individual stocks; for heavyweights in the industrials sector, including BA, UNP, and GE, and even for the megacap stars GOOG, TSLA, and MSFT. In contrast, the Trefis High Quality Portfolio, with a collection of 30 stocks, has outperformed the S&P 500 each year…
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