Latest news with #ZTOExpress
Yahoo
6 days ago
- Business
- Yahoo
ZTO Express (Cayman)'s (NYSE:ZTO) Returns On Capital Are Heading Higher
What are the early trends we should look for to identify a stock that could multiply in value over the long term? One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing amount of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. Speaking of which, we noticed some great changes in ZTO Express (Cayman)'s (NYSE:ZTO) returns on capital, so let's have a look. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. The formula for this calculation on ZTO Express (Cayman) is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.19 = CN¥12b ÷ (CN¥93b - CN¥29b) (Based on the trailing twelve months to March 2025). Therefore, ZTO Express (Cayman) has an ROCE of 19%. On its own, that's a standard return, however it's much better than the 13% generated by the Logistics industry. See our latest analysis for ZTO Express (Cayman) In the above chart we have measured ZTO Express (Cayman)'s prior ROCE against its prior performance, but the future is arguably more important. If you're interested, you can view the analysts predictions in our free analyst report for ZTO Express (Cayman) . Investors would be pleased with what's happening at ZTO Express (Cayman). The numbers show that in the last five years, the returns generated on capital employed have grown considerably to 19%. The company is effectively making more money per dollar of capital used, and it's worth noting that the amount of capital has increased too, by 67%. This can indicate that there's plenty of opportunities to invest capital internally and at ever higher rates, a combination that's common among multi-baggers. For the record though, there was a noticeable increase in the company's current liabilities over the period, so we would attribute some of the ROCE growth to that. Essentially the business now has suppliers or short-term creditors funding about 31% of its operations, which isn't ideal. Keep an eye out for future increases because when the ratio of current liabilities to total assets gets particularly high, this can introduce some new risks for the business. All in all, it's terrific to see that ZTO Express (Cayman) is reaping the rewards from prior investments and is growing its capital base. Given the stock has declined 50% in the last five years, this could be a good investment if the valuation and other metrics are also appealing. So researching this company further and determining whether or not these trends will continue seems justified. On the other side of ROCE, we have to consider valuation. That's why we have a that is definitely worth checking out. For those who like to invest in solid companies, check out this free list of companies with solid balance sheets and high returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
29-05-2025
- Business
- Yahoo
Here's Why Investors Should Avoid ZTO Express Stock Now
ZTO Express Cayman Inc. ZTO is facing significant challenges from rising operating expenses and a deteriorating liquidity position, which are adversely affecting its bottom line and making it an unattractive choice for investors' portfolios. Let's delve deeper. Southward Earnings Estimate Revision: The Zacks Consensus Estimate for current-year earnings has been revised 5.2% downward over the past 60 days and is pegged at $1.65 per share. Meanwhile, the consensus estimate for 2026 earnings is pegged at $1.78 per share, declining 6.8% over the past 60 days. The unfavorable estimate revision indicates brokers' lack of confidence in the stock. Dim Price Performance: ZTO Express shares have lost 26.5% in the past year compared with the industry's 16.6% decline. Image Source: Zacks Investment Research Weak Zacks Rank: ZTO currently carries a Zacks Rank #5 (Strong Sell). Unimpressive Earnings Surprise History: ZTO has a discouraging earnings surprise history, having surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missing twice. The average negative surprise is 2.9%. Bearish Industry Rank: The industry to which ZTO Express belongs currently has a Zacks Industry Rank of 195 (out of 245). Such an unfavorable rank places it in the bottom 20% of Zacks show that 50% of a stock price movement is directly related to the performance of the industry group it belongs to. A mediocre stock within a strong group is likely to outperform a robust stock in a weak industry. Reckoning the industry's performance becomes imperative in this case. Headwinds: ZTO Express is under increasing pressure on its bottom line due to rising expenses, which are challenging its financial stability. In the first quarter of 2025, the company experienced a 17.9% year-over-year increase in total operating expenses. This rise was largely due to higher sorting hub operating costs and other related expenses. The operating costs of the sorting center were $319 million, an increase of 6.8% year over year. Trunk transportation costs were $480.0 million, an increase of 3.3% year over year. The company is now grappling with the impact of these escalating costs, which are putting additional strain on its profitability and overall financial health. Moreover, the company's financial stability is under pressure, as reflected by a declining current ratio (a measure of liquidity). ZTO's current ratio fell from 1.49 in 2022 to 1.34 in 2023 and dropped further to 1.07 in 2024. In the first quarter of 2025, the current ratio was pegged at 1.05. This consistent downward trend is concerning, as it raises questions about the company's ability to meet its short-term debt obligations. Investors interested in the Transportation sector may consider Copa Holdings CPA and Ryanair RYAAY. CPA currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here. CPA has an expected earnings growth rate of 14.3% for the current year. The company has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 5.5%. Shares of CPA have risen 24.7% year to date. RYAAY currently sports a Zacks Rank of 1. RYAAY has an expected earnings growth rate of 30.5% for the current year. The company has a mixed earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, delivering an average beat of 46.6%. Shares of RYAAY have rallied 29.9% year to date. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ryanair Holdings PLC (RYAAY) : Free Stock Analysis Report Copa Holdings, S.A. (CPA) : Free Stock Analysis Report ZTO Express (Cayman) Inc. (ZTO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Malaysian Reserve
27-05-2025
- Business
- Malaysian Reserve
Alibaba weighs options to reduce stake in ZTO Express
ALIBABA Group Holding Ltd. is considering options to pare down its minority stake in express delivery firm ZTO Express (Cayman) Inc., according to people familiar with the matter. Alibaba has held talks with investment banks to evaluate a potential sale of bonds exchangeable into the shares of ZTO Express, the people said, asking not to be identified because the deliberations are private. Considerations are ongoing and Alibaba may still decide against selling exchangeable bonds, the people said. Representatives for Alibaba and ZTO didn't immediately respond to requests seeking comment. Alibaba led a group of investors in buying 10% of ZTO for $1.38 billion in 2018 to boost its global shipping services. The investor group included Alibaba's logistics arm Cainiao, it said at the time, without identifying other buyers. ZTO Express raised $1.4 billion in an initial public offering in New York in 2016, and then a second listing in Hong Kong raised a similar amount in 2020. ZTO's shares are down about 13% in the US this year. The Shanghai-based company has a market value of around $13.6 billion. A sale of exchangeable bonds by Alibaba would echo a similar move by fellow Chinese tech company Baidu Inc., which in March raised $2 billion by selling bonds exchangeable into the Hong Kong shares of online-travel agency Group Ltd. –BLOOMBERG
Globe and Mail
22-05-2025
- Business
- Globe and Mail
ZTO Express Q1 Earnings Flat Y/Y, Revenues Miss Estimates
ZTO Express ZTO reported first-quarter 2025 earnings of 37 cents per share, which came in line with the year-ago quarter. Total revenues of $1.50 billion missed the Zacks Consensus Estimate of $1.67 billion and improved year over year. Mr. Meisong Lai, founder, chairman and chief executive officer at ZTO, stated, "During the first quarter, ZTO maintained leading service quality and achieved 8.5 billion of parcel volume and 2.3 billion of adjusted net income. Retail volume increased by 46% year over year for the quarter as we penetrated deeper into reverse logistics, and we continued to work closely with various e-commerce platform and enterprise customers to develop differentiated products and services which include time-definite delivery and customized KA consumer services." Detailed Operational Statistics Revenue from the core express delivery business increased 9.8% year over year, owing to 19.1% growth in parcel volume and a 7.8% decrease in parcel unit price. KA revenues, generated by direct sales organizations, increased 129.3%, driven by an increase in e-commerce return parcels. Revenue from freight forwarding services fell 11.6% year over year, owing to declining cross-border e-commerce pricing. Revenue from sales of accessories, which largely consisted of sales of thermal paper used for digital waybills' printing, rose 15.5% year over year. Other revenues were derived mainly from financing services. Gross profit decreased 10.4% from the year-ago reported quarter. Gross margin rate fell to 24.7% from 30.1% in the year-ago period. Total operating expenses were RMB283.8 million ($39.1 million) compared with RMB735.4 million in the year-ago period. ZTO Express exited the first quarter of 2025 with cash and cash equivalents of $1.71 billion compared with $1.84 billion at the end of the prior quarter. ZTO's board approved its share repurchase program in November 2018 and has made subsequent changes so far. The latest announcement includes an increase in the aggregate value of shares to be repurchased to $2 billion and extends the effective period through June 30, 2025. As of March 31, 2025, ZTO had purchased an aggregate of 50,899,498 ADSs for $1,228.3 million on the open market, including repurchase commissions. The remaining funds available under the share repurchase program are $771.7 million. On May 20, 2025, ZTO announced that it would extend the current share repurchase program to June 30, 2026. ZTO's 2025 Guidance Based on current market and operating conditions, ZTO Express reaffirms its 2025 parcel volume guidance of 40.8 billion to 42.2 billion, reflecting 20-24% year-over-year growth. ZTO's Zacks Rank Currently, ZTO Express carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Q1 Performances of Other Transportation Companies United Airlines United Airlines ' UAL first-quarter 2025 earnings per share (excluding 25 cents from non-recurring items) of 91 cents surpassed the Zacks Consensus Estimate of 75 cents. In the year-ago quarter, the Chicago-based airline reported a loss of 15 cents per share. Operating revenues of $13.21 billion fell marginally short of the Zacks Consensus Estimate of $13.22 billion. The top line increased 5.4% year over year despite the tariff-induced slowdown in domestic air travel demand. Passenger revenues (which accounted for 89.7% of the top line) rose 4.8% year over year to $11.9 billion. UAL flights transported 40,806 passengers in the first quarter, up 3.8% year over year. Delta Air Lines Delta Air Lines DAL reported first-quarter 2025 earnings (excluding 9 cents from non-recurring items) of 46 cents per share, which surpassed the Zacks Consensus Estimate of 40 cents. Earnings increased 2.2% on a year-over-year basis due to low fuel costs. Revenues in the March-end quarter were $14.04 billion, surpassing the Zacks Consensus Estimate of $13.81 billion and increasing 2.1% on a year-over-year basis. Adjusted operating revenues (excluding third-party refinery sales) rose 3.3% year over year to $13 billion. C.H. Robinson C.H. Robinson Worldwide, Inc. ( CHRW ) reported mixed first-quarter 2025 results, wherein earnings surpassed the Zacks Consensus Estimate while revenues missed the same. Quarterly earnings per share (EPS) of $1.17 outpaced the Zacks Consensus Estimate of $1.02 and improved 36% year over year. Total revenues of $4.04 billion missed the Zacks Consensus Estimate of $4.31 billion and declined 8.2% year over year, owing to the divestiture of CHRW's Europe Surface Transportation business, lower volume in its North America truckload services, and lower pricing in the ocean services. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Delta Air Lines, Inc. (DAL): Free Stock Analysis Report United Airlines Holdings Inc (UAL): Free Stock Analysis Report C.H. Robinson Worldwide, Inc. (CHRW): Free Stock Analysis Report ZTO Express (Cayman) Inc. (ZTO): Free Stock Analysis Report
Yahoo
22-05-2025
- Business
- Yahoo
ZTO Express (Cayman) Inc (ZTO) Q1 2025 Earnings Call Highlights: Navigating Growth Amidst ...
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. Warning! GuruFocus has detected 1 Warning Sign with ZTO. Release Date: May 21, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. ZTO Express (Cayman) Inc (NYSE:ZTO) 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 (NYSE: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%. 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 (NYSE:ZTO) was slightly slower than the industry in volume growth during the first quarter. Q: How does ZTO plan to achieve its volume growth target despite intense competition, and what are the implications for profit? A: (Huiping Yan, CFO) ZTO aims to maintain service quality while focusing on volume leadership and reasonable profit. The company has narrowed the gap between its volume growth and the industry average by incentivizing network partners. ZTO continues to focus on upgrading its revenue structure, particularly in retail and reverse logistics, which saw significant growth. The company plans to deepen cooperation with e-commerce platforms to sustain this growth. Q: What are the expectations for unit revenue and cost, and how is AI being integrated into ZTO's operations? A: (Huiping Yan, CFO) The decline in unit revenue is due to intense competition and an increase in lower-weight parcels. ZTO is focusing on cost efficiency, with significant reductions in transportation and sorting costs. AI is being used in sorting operations, route planning, and order allocation to improve efficiency and reduce errors. ZTO plans to further explore AI applications in last-mile delivery and other areas. Q: What progress has been made in direct linkage and cost optimization, and what are the expectations for the upcoming shopping festival? A: (Huiping Yan, CFO) ZTO is optimizing outlet layouts and promoting direct sorting and delivery to reduce last-mile costs and increase outlet earnings. The company expects significant cost savings and improved network partner earnings. For the upcoming shopping festival, ZTO anticipates high parcel volumes and plans to maintain competitive pricing while supporting network stability. Q: How does ZTO plan to handle the intensified price competition and its impact on ASP? A: (Huiping Yan, CFO) ZTO is focusing on maintaining high service quality and strategically adjusting pricing based on market conditions. The company is leveraging its cost efficiency initiatives to offset pricing pressures and plans to continue optimizing its revenue mix to sustain profitability. Q: What are ZTO's strategic priorities in response to current market challenges? A: (Meisong Lai, CEO) ZTO's strategic priority is to solidify its leadership in quality and scale while achieving reasonable profit levels. The company is committed to sustainable growth, reinforcing its network stability, and leveraging technology to enhance operational efficiency. ZTO aims to build an enduring enterprise that can adapt to changing market dynamics. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
