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FedEx Corp. (NYSE: FDX) may be about to become a huge beneficiary of the transportation catch-up boom taking place in America and elsewhere. Bank of America/Merrill Lynch has added the shipping and transport giant to its prized US 1 List, which is the equivalent to what investors know as a Conviction Buy List.

FedEx shares remain one of BofA’s top transportation stocks. The firm noted that it trades at only 12.7 times its fiscal 2014 earnings per share estimates. This is said to be under the historical 13 times to 20 times one-standard deviation trading range.

BofA said:

Earlier this month, we highlighted improving freight data from Asia, including Hong Kong Air Cargo Terminals, as well as accelerating China port volumes, which we believe drove a large portion of FDX’s 12% gain year-to-date. FedEx posted its first uptick in International Priority volumes in 5 quarters in its F2Q13. Last week, UPS noted that in the U.S., January started off stronger than it expected, Europe is more stable than last year and is improving, and Asia global growth trends have returned to more normal trends. We believe the upside from FedEx’s $1.7 billion profit improvement plan, which should gain visibility in May, is just beginning to make inroads with investors, and provides upside potential.

BofA sees $500 million in cost cut possibilities. Its $1.7 billion profit improvement plan also is expected to show tangible results this year. BofA sees 75% of the benefit layered into next year and all the benefits thereafter.

The firm has reiterated its Buy rating and has a $122 price target objective. The consensus target price from Thomson Reuters is listed as almost $108, and the street high target is listed as being $125.

On a day that DJIA was trading down triple-digits on profit taking, FedEx shares are up about 0.7% at $103.50. Investors should pay attention that this marks a 52-week high, as the prior 52-week range is $83.80 to $103.14. If FedEx hits that $122 target price, that will represent all-time highs in the stock.