JPMorgan has raised its rating for ZTO Express (ZTO, Financial), upgrading the stock from Neutral to Overweight. The investment firm has also set a new price target of $21 for the company. The decision indicates increased confidence in ZTO's future performance and market positioning.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 19 analysts, the average target price for ZTO Express (Cayman) Inc (ZTO, Financial) is $23.62 with a high estimate of $31.85 and a low estimate of $16.76. The average target implies an upside of 32.79% from the current price of $17.79. More detailed estimate data can be found on the ZTO Express (Cayman) Inc (ZTO) Forecast page.
Based on the consensus recommendation from 21 brokerage firms, ZTO Express (Cayman) Inc's (ZTO, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for ZTO Express (Cayman) Inc (ZTO, Financial) in one year is $31.67, suggesting a upside of 78.07% from the current price of $17.785. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the ZTO Express (Cayman) Inc (ZTO) Summary page.
ZTO Key Business Developments
Release Date: May 21, 2025
- Parcel Volume: RMB8.5 billion, up 19.1% year over year.
- Adjusted Net Income: RMB2.3 billion, increased 1.6% year over year.
- Total Revenue: RMB10.9 billion, up 9.4% year over year.
- ASP for Core Express Delivery: Decreased 7.8% or RMB0.11.
- Total Cost of Revenue: RMB8.2 billion, increased 17.9%.
- Gross Profit: RMB2.7 billion, decreased 10.4%.
- Gross Profit Margin: 24.7%, decreased 5.4%.
- Income from Operations: RMB2.4 billion, increased 6.1%.
- Operating Cash Flow: RMB2.4 billion, increased 16.3%.
- Capital Expenditure: RMB2 billion for Q1.
- 2025 Full-Year Parcel Volume Guidance: RMB40.8 billion to RMB42.2 billion, a 20% to 24% increase year over year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- ZTO Express (Cayman) Inc (ZTO, Financial) achieved a 19.1% year-over-year increase in parcel volume, reaching RMB8.5 billion in the first quarter of 2025.
- The company reported an adjusted net income of RMB2.3 billion, marking a 1.6% increase year over year.
- Retail parcel volume increased by 46% year over year, with reverse logistics volumes surging over 150%, indicating strong growth in these segments.
- ZTO Express (Cayman) Inc (ZTO) successfully decreased unit transportation and sorting costs by RMB0.09 year over year through digitization and accountability metrics.
- The company maintained strong corporate cost efficiency, with SG&A expenses as a percentage of revenue decreasing to 4.7%.
Negative Points
- The ASP for core express delivery business decreased by 7.8% due to intensified competition, impacting revenue.
- Gross profit decreased by 10.4% to RMB2.7 billion, and the gross profit margin rate decreased by 5.4% to 24.7%.
- Price competition in the express delivery industry intensified, putting pressure on profit margins.
- The proportion of lower value parcels increased, further intensifying price competition and impacting revenue growth.
- Despite efforts to narrow the gap, ZTO Express (Cayman) Inc (ZTO) was slightly slower than the industry in volume growth during the first quarter.
