Rothschild downgraded FedEx to Neutral, arguing its recent 37% stock rally already prices in the planned LTL spin-off. The broker’s sum-of-the-parts analysis values the combined entity at roughly $316 per share, close to current trading levels. With a $317 price target implying minimal upside, Rothschild sees limited room for further gains.

The split, scheduled for June, is expected to unlock about $10 billion in value for the less-than-truckload unit, which will trade alongside listed peers. Meanwhile, the remaining parcel business has improved through cost cuts, though Rothschild forecasts a modest 6% valuation erosion post-spin-off. The broker remains constructive on the long-term outlook for both entities.

Investors should watch how the standalone LTL company performs against competitors, particularly as it expands its sales force and invests in technology. For FedEx, the key will be sustaining parcel segment margins in a weaker economic backdrop. The downgrade signals that much of the structural improvement is already reflected in the share price.