ZTO Express (Cayman) (ZTO) Rating Lowered to Sell at Zacks Investment Research

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ZTO Express (Cayman) (NYSE:ZTO) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Monday, Zacks.com reports.

According to Zacks, “ZTO Express is being aided by increased parcel volumes. Additionally, impressive performance of the company's express delivery services unit is encouraging. Rapid growth of China’s e-commerce industry and increased demand for express delivery services are also encouraging. Like 2018, these factors boosted its top line in first-quarter 2019. However, high operating expenses (up almost 50%) hurt the bottom line in the first quarter as has been the case in the past few quarters. ZTO Express’ investments to expand its portfolio  are bumping up costs. In fact, the company delivered lower-than-expected earnings per share in the quarter. Stringent government regulations and tightening policies of the Chinese market too act as a major hindrance to ZTO Express’ business. In fact, shares of the company have underperformed its industry on a year-to-date basis.”

Several other research analysts have also commented on the company. TheStreet raised ZTO Express (Cayman) from a “c+” rating to a “b” rating in a report on Thursday. UBS Group raised ZTO Express (Cayman) from a “neutral” rating to a “buy” rating in a report on Tuesday, April 23rd. One research analyst has rated the stock with a sell rating, one has issued a hold rating and two have assigned a buy rating to the company. The company currently has an average rating of “Hold” and a consensus target price of $21.50.

Shares of NYSE ZTO traded up $0.16 during midday trading on Monday, hitting $18.09. 83,421 shares of the company’s stock were exchanged, compared to its average volume of 2,397,285. ZTO Express has a 12-month low of $14.69 and a 12-month high of $22.67. The firm has a market capitalization of $9.09 billion, a price-to-earnings ratio of 23.51 and a beta of 0.72.

ZTO Express (Cayman) (NYSE:ZTO) last issued its quarterly earnings data on Wednesday, May 15th. The transportation company reported $0.18 EPS for the quarter, missing the Thomson Reuters’ consensus estimate of $0.19 by ($0.01). ZTO Express (Cayman) had a return on equity of 13.44% and a net margin of 24.23%. The business had revenue of $4.57 billion for the quarter, compared to analysts’ expectations of $4.48 billion. During the same period in the previous year, the firm posted $0.78 EPS. The firm’s revenue for the quarter was up 29.0% compared to the same quarter last year. As a group, analysts anticipate that ZTO Express will post 0.96 EPS for the current year.

A number of large investors have recently added to or reduced their stakes in ZTO. Huntington National Bank lifted its position in ZTO Express (Cayman) by 40.3% in the 4th quarter. Huntington National Bank now owns 3,066 shares of the transportation company’s stock worth $49,000 after buying an additional 880 shares during the last quarter. Ladenburg Thalmann Financial Services Inc. lifted its position in ZTO Express (Cayman) by 40.9% in the 1st quarter. Ladenburg Thalmann Financial Services Inc. now owns 2,805 shares of the transportation company’s stock worth $51,000 after buying an additional 814 shares during the last quarter. Advisors Asset Management Inc. lifted its position in ZTO Express (Cayman) by 255.2% in the 1st quarter. Advisors Asset Management Inc. now owns 3,779 shares of the transportation company’s stock worth $69,000 after buying an additional 2,715 shares during the last quarter. Acadian Asset Management LLC bought a new stake in ZTO Express (Cayman) in the 1st quarter worth approximately $167,000. Finally, OLD National Bancorp IN bought a new stake in ZTO Express (Cayman) in the 4th quarter worth approximately $186,000. Institutional investors own 36.70% of the company’s stock.

ZTO Express (Cayman) Company Profile

ZTO Express (Cayman) Inc provides express delivery and other value-added logistics services in the People's Republic of China. The company offers delivery services for e-commerce and traditional merchants, and other express service users. As of December 31, 2017, it operated a fleet of approximately 3,600 self-owned trucks.

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