FedEx boomed during the pandemic and the e-commerce boom, but the past few years have brought it back to reality.
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Still, its performance over the past 10 years hasn't been bad. It's certain that the shipping and logistics giant isn't going anywhere in the near future.
So what would have happened if you invested $1,000 in FedEx 10 years ago?
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FedEx's past 10 years
Ten years ago, FedEx stock cost $136.27. At the time of writing, it was valued at $264.48, having almost doubled (94.09% growth) over the past 10 years.
If you bought $1,000 worth of FDX stock 10 years ago, it would be worth $1,940.45 today.
FedEx stock also pays a dividend, and that dividend has steadily increased over the past decade. Ten years ago, FedEx's dividend yield was around 0.46%, but it has hovered around 2% for the past two years. The current interest rate is approximately 1.90%. That means yields have roughly quadrupled over the past 10 years.
FedEx vs. S&P 500
Inventory does not exist in a vacuum. How does FedEx compare to the S&P 500?
Unfortunately for FedEx investors, FedEx underperformed the S&P 500. The SPY index fund, which tracks the S&P 500, has increased in value by 169.15% over the past 10 years.
SPY currently doesn't pay as much of a dividend yield as FDX (1.32%), but it has paid more in dividends over the past 10 years. In other words, by investing in an index fund, you could have saved yourself the trouble of analyzing and selecting stocks and obtained higher returns.
Should you invest in FedEx?
As one of the world's largest shipping and transportation companies, FedEx is likely to be around for a while.
The stock currently has a buy or hold rating from most securities analysts. But that doesn't mean it will outperform the overall market in the coming years.
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Still, FedEx remains in the stock picking discussion due to its relatively high dividend and stable business model. Keep an eye on rival UPS and how changes at the U.S. Postal Service could impact both FedEx and UPS in the coming years.
GOBankingRates Details
This article originally appeared on GOBankingRates.com: If you invested $1,000 in FedEx stock 10 years ago, how much money would you have today?
