FedEx Corporation (FDX) vs UnitedHealth Group Incorporated (UNH): Which Is the Better Buy in 2026?
As of 2026-11-01, FDX is undervalued at $313, with a DCF intrinsic value of $620 and a margin of safety of 49%. UNH is overvalued at $407, with an intrinsic value of $367 and a margin of safety of -11%. Of the two, FDX has the wider margin of safety.
Rewards
- ★Free cash flow has grown at a 24.1% CAGR over the past 4 years, demonstrating strong earnings power growth.
- ★Each dollar of retained earnings has created $1.28 of earning power — management is creating shareholder value.
- ★UnitedHealth Group Incorporated scores 73/100 on the Economic Moat Score (Wide Moat), with revenue predictability as the strongest competitive dimension.
Risks
- ⚠FCF yield of 7.7% suggests reasonable valuation assuming continued moderate growth.
- ⚠ROIC has declined by 6.9 percentage points over the past 4 years, which may signal competitive erosion.
- ⚠Gross margin of 20.0% is low, suggesting a competitive or commodity-like market with limited pricing power.
- ⚠FCF yield of 7.3% suggests reasonable valuation assuming continued moderate growth.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →What growth rate is the market pricing in at $313?
The market implies +7.2% Owner Earnings growth, roughly in line with history — reasonably priced.
Standard FCF implies +5.5%, reflecting ongoing growth investment.
What growth rate is the market pricing in at $407?
The market implies +14.2% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +4.2%, reflecting heavy growth investment.
Economic Moat Score
Learn more →Narrow moat with margin stability as the key competitive advantage. Improving roic consistency would strengthen the moat.
Wide moat driven primarily by revenue predictability. Margin Stability is the area most vulnerable to competitive pressure.
Forensic Accounting
Learn more →M-Score Trend
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is optimistic — be cautious and ensure you have a margin of safety"
"Market is optimistic — be cautious and ensure you have a margin of safety"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: FDX vs UNH
Is FedEx Corporation or UnitedHealth Group Incorporated more undervalued in 2026?▼
Based on our discounted cash flow model, FDX trades at a 49.4% margin of safety (intrinsic value $620 vs. price $313), compared to UNH's -10.8% margin of safety (intrinsic $367 vs. $407).
Which stock has a wider economic moat, FedEx Corporation or UnitedHealth Group Incorporated?▼
UNH scores 73/100 (Wide moat), while FDX scores 57/100 (Narrow moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is FedEx Corporation in financial distress?▼
FDX's Altman Z-Score of 2.6 places it in the Grey zone, signaling elevated bankruptcy risk. UNH scores 2.9 (Grey zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which company has better free cash flow, FedEx Corporation or UnitedHealth Group Incorporated?▼
FedEx Corporation (FDX) generates a 7.7% free cash flow yield, compared to UnitedHealth Group Incorporated's 7.3%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, FedEx Corporation or UnitedHealth Group Incorporated?▼
UNH earns 11.5% ROIC versus FDX's 5.4%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.
Which dividend is safer, FedEx Corporation's or UnitedHealth Group Incorporated's?▼
FDX's dividend earns a safety score of 94/100 (Very Safe), compared to UNH's 84/100 (Very Safe). FDX has raised its dividend for 3 consecutive years.