ZTO Express (Cayman) (NYSE:ZTO) Releases Quarterly Earnings Results, Beats Estimates By $0.06 EPS

ZTO Express (Cayman) (NYSE:ZTO) announced its earnings results on Tuesday. The transportation company reported $0.56 earnings per share for the quarter, beating analysts’ consensus estimates of $0.50 by $0.06, FiscalAI reports. ZTO Express (Cayman) had a net margin of 17.87% and a return on equity of 14.23%. The business had revenue of $2.14 billion for the quarter, compared to the consensus estimate of $2.15 billion.

Here are the key takeaways from ZTO Express (Cayman)’s conference call:

• Strong second-quarter performance: Parcel volume increased 6.5% year over year to approximately 10.9 billion, market share rose 0.4 percentage points, and adjusted net income grew 50.3% to CNY 3.1 billion. Results benefited partly from a CNY 344.3 million tax refund.
• Cost efficiency and margins improved despite higher fuel prices. Combined transportation and sorting costs declined CNY 0.02 per parcel, while operating margin expanded 1.3 percentage points to 22.2%; management expects core transit costs to fall about CNY 0.03 for the full year.
• Higher-value businesses are strengthening profitability. Retail parcel volume grew 47%, including reverse-logistics volume of roughly 9.8 million parcels per day, and management said reverse parcels still generate higher per-parcel profit than standard e-commerce shipments.
• AI and digitization are becoming major efficiency drivers. ZTO said AI-based routing, machine vision, data analysis and customer service reduced transportation costs, improved unloading efficiency, cut management analysis time by more than 90%, and raised consumer satisfaction to nearly 90%.
• Management lowered or set full-year parcel-volume growth guidance at 6%–10%, equivalent to 40.83–42.37 billion parcels, while warning that elevated oil prices could add CNY 0.01–0.02 per parcel to transportation costs in the second half. Gradual implementation of broader social-insurance requirements for couriers is also expected to increase end-to-end costs in the near term.

ZTO Express (Cayman) Stock Up 0.9%

Shares of NYSE ZTO opened at $23.11 on Wednesday. The stock has a market capitalization of $12.88 billion, a P/E ratio of 14.17, a PEG ratio of 0.87 and a beta of -0.22. ZTO Express has a one year low of $17.74 and a one year high of $26.20. The firm’s 50 day simple moving average is $23.25 and its two-hundred day simple moving average is $23.83. The company has a debt-to-equity ratio of 0.16, a current ratio of 1.64 and a quick ratio of 1.64.

Hedge Funds Weigh In On ZTO Express (Cayman)

Several institutional investors and hedge funds have recently made changes to their positions in ZTO. Caitong International Asset Management Co. Ltd purchased a new stake in ZTO Express (Cayman) during the fourth quarter valued at about $25,000. Atlas Capital Advisors Inc. purchased a new position in shares of ZTO Express (Cayman) in the fourth quarter worth about $35,000. Smartleaf Asset Management LLC lifted its stake in shares of ZTO Express (Cayman) by 61.4% in the 2nd quarter. Smartleaf Asset Management LLC now owns 2,021 shares of the transportation company’s stock valued at $36,000 after acquiring an additional 769 shares during the last quarter. EverSource Wealth Advisors LLC boosted its holdings in ZTO Express (Cayman) by 156.2% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 3,489 shares of the transportation company’s stock valued at $62,000 after acquiring an additional 2,127 shares during the period. Finally, Parallel Advisors LLC boosted its holdings in ZTO Express (Cayman) by 74.3% during the 3rd quarter. Parallel Advisors LLC now owns 3,668 shares of the transportation company’s stock valued at $70,000 after acquiring an additional 1,563 shares during the period. Institutional investors own 41.65% of the company’s stock.

Wall Street Analysts Forecast Growth

Several analysts have recently weighed in on the stock. Morgan Stanley restated an “overweight” rating and set a $30.10 price objective on shares of ZTO Express (Cayman) in a research report on Wednesday, May 20th. Weiss Ratings reissued a “hold (c+)” rating on shares of ZTO Express (Cayman) in a research note on Monday. Finally, Zacks Research downgraded ZTO Express (Cayman) from a “strong-buy” rating to a “hold” rating in a research report on Wednesday, August 5th. One equities research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating and three have issued a Hold rating to the stock. According to MarketBeat, the company presently has an average rating of “Moderate Buy” and a consensus target price of $27.03.

ZTO Express (Cayman) Company Profile

ZTO Express (Cayman) Inc is one of China’s leading express delivery companies, specializing in both domestic and cross-border parcel logistics. The company operates a technology-enabled network that connects shippers, independent pickup and delivery stations, regional sorting hubs and end customers. ZTO’s service portfolio includes standard express, heavy-weight parcel delivery, time-definite shipments and e-commerce logistics solutions tailored for online retailers and marketplaces.

Founded in 2002 and headquartered in Shanghai, ZTO has grown rapidly by leveraging a franchise-style operating model that engages a broad network of independent contractors.