FedEx Corporation (FDX)
Solvency ratios
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | |
|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financial leverage ratio | 3.12 | 3.15 | 3.34 | 3.45 | 3.43 |
The analysis of FedEx Corporation's solvency ratios over the period from May 31, 2021, to May 31, 2025, indicates a consistent pattern of minimal leverage in terms of debt obligations. Specifically, the debt-to-assets ratio, debt-to-capital ratio, and debt-to-equity ratio all remain at zero throughout this timeframe. This suggests that FedEx has not reported any debt relative to its assets, capital, or equity, implying a markedly conservative financial structure with no reliance on external borrowing in the reported periods.
Conversely, the financial leverage ratio exhibits a relatively high and stable value, fluctuating marginally between 3.43 and 3.12 over the four-year span. This ratio measures the extent to which the company employs debt and financial liabilities to finance its assets and operations, indicating that while official debt levels (as per the ratios) are reported as zero, the company maintains substantial leverage through other financial means, such as preferred stock, lease obligations, or off-balance-sheet financings, which are not captured in the debt ratios.
In summary, the data portrays FedEx as a company with no apparent traditional debt load, maintaining ratios at zero, while simultaneously exhibiting a high and consistent financial leverage ratio. This configuration suggests reliance on alternative forms of leverage or capital structure components outside the standard debt metrics, or it may point to specific accounting treatments affecting the reporting of debt. The stability of these ratios over time indicates a controlled and consistent approach to its financial strategy with regard to solvency.
Coverage ratios
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | |
|---|---|---|---|---|---|
| Interest coverage | — | 8.83 | 16.03 | 8.41 | 10.03 |
The interest coverage ratio for FedEx Corporation demonstrates notable fluctuations over the specified period. As of May 31, 2021, the ratio stood at 10.03, indicating that the company's earnings before interest and taxes (EBIT) comfortably covered its interest expenses approximately ten times over. This suggests a solid capacity to meet interest obligations at that time.
By May 31, 2022, the ratio declined to 8.41, reflecting a decrease in coverage and possibly signaling increased interest expenses or reduced EBIT. Nevertheless, a ratio well above 1 indicates that the company remained well-positioned to service its interest commitments.
A significant improvement is observed by May 31, 2023, when the ratio surged to 16.03. This substantial increase suggests a marked strengthening of EBIT relative to interest costs, thus enhancing the company's financial cushion for interest payments and indicating improved operational performance or reduced interest burden.
However, the subsequent year shows a decline to 8.83 as of May 31, 2024. While still above the conservative threshold of 1.5–2 often considered satisfactory, this decrease suggests some erosion in the company's ability to cover interest expenses compared to the peak in 2023.
Interest coverage data for May 31, 2025, is unavailable or not reported, implying the data is either not applicable or not provided for that date.
Overall, the trend indicates that FedEx's interest coverage ratio experienced some volatility over the two-year span, with a peak in 2023 affirming strong interest payment capacity, followed by a decline in 2024. The ratios remain above critical thresholds, portraying a generally capable interest coverage position, albeit with some variability that warrants ongoing monitoring for potential shifts in earnings and interest obligations.