Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zto-express" target="_blank" data-smartkarma-citation="entities:23628:1" rel="noopener">ZTO Express (ZTO US)</a> met consensus Q422 EPS estimate despite a miss on Revenue</li>
<li>Management expects to exceed industry volume growth (around +10%) in 2023</li>
<li>Likely obstacles to a sharp earnings recovery are: ASP momentum, "new-old" competition, and a lack of demonstrated cost control</li>
</ul>



ZTO Express (ZTO US) met consensus Q422 EPS estimate despite a miss on Revenue
Management expects to exceed industry volume growth (around +10%) in 2023
Likely obstacles to a sharp earnings recovery are: ASP momentum, "new-old" competition, and a lack of demonstrated cost control


ZTO Express Q4/2022 Results & Guidance:  Moderate Growth in '23, but Also Obstacles

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

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HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zto-express-cayman-inc" target="_blank" data-smartkarma-citation="entities:33488:1" rel="noopener">ZTO Express Cayman Inc (2057 HK)</a>'s 63.1% surge in 3Q22 adjusted net profit demonstrated its ability to thrive even amid the challenging operating environment.  </li>
<li>It is positive on FY23 outlook and believes industry volume can return to double-digit growth. ZTO is confident of market share gain, better cost management and stable pricing. </li>
<li>We think its premium valuations are highly justified by strong cash generating ability. The increase of US$500m and lengthening of one year in share repurchase are very welcomed.</li>
</ul>



ZTO Express Cayman Inc (2057 HK)'s 63.1% surge in 3Q22 adjusted net profit demonstrated its ability to thrive even amid the challenging operating environment.  
It is positive on FY23 outlook and believes industry volume can return to double-digit growth. ZTO is confident of market share gain, better cost management and stable pricing. 
We think its premium valuations are highly justified by strong cash generating ability. The increase of US$500m and lengthening of one year in share repurchase are very welcomed.


ZTO Express (2057 HK/​​ZTO US): Solid Upward Momentum Stays Intact

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<ul>
<li>The Aug China Express Development Index points to further industry recovery; and as the leader with 23% (+2pp YoY) market share, <a href="https://www.smartkarma.com/entities/zto-express-cayman-inc" target="_blank" data-smartkarma-citation="entities:33488:1" rel="noopener">ZTO Express (2057 HK)</a> should ride on the uptrend. </li>
<li>Sustained volume outperformance, upside on pricing and excellent cost control capability are drivers in 2H22. We are also comfortable with its solid financial position. </li>
<li>ZTO Express has above-average earnings quality and enjoys benefits from industry consolidation. Its on par valuation with the industry makes the stock appealing.</li>
</ul>


The Aug China Express Development Index points to further industry recovery; and as the leader with 23% (+2pp YoY) market share, ZTO Express (2057 HK) should ride on the uptrend. 
Sustained volume outperformance, upside on pricing and excellent cost control capability are drivers in 2H22. We are also comfortable with its solid financial position. 
ZTO Express has above-average earnings quality and enjoys benefits from industry consolidation. Its on par valuation with the industry makes the stock appealing.


ZTO Express (2057 HK/​ZTO US): Quality Speaks for Itself

China

STO Express Co Ltd. develops, manufactures and markets valves, pipe fittings and plumbing equipment. The Company's business encompasses the    development, manufacturing, sales and servicing of plumbing equipment, valves,  pipe fittings, metal construction materials, home automation, environmental protection and energy control systems.

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STO Express (002468 CH)

ZTO Express Q4/2022 Results & Guidance: Moderate Growth in '23, but Also Obstacles

ZTO guides strong volume growth and potentially better unit economics in '23, but we expect price pressure to return, and the company needs to rein...

Daniel Hellberg

CX Daily: Five Things to Know About China’s Latest IPO System Overhaul

Five things to know about China’s latest IPO system overhaul. Police say student missing for 100 days hanged himself. China completes provincial...

Caixin Global

ZTO Express (2057 HK/ZTO US): Solid Upward Momentum Stays Intact

ZTO's strong 3Q22 net profit growth and increased buyback program are both positive developments. It is also confident on the FY23 outlook as...

Osbert Tang, CFA

CX Daily: The Shadowy Businessman Behind a Multibillion-Dollar Bank Swindle

In Depth: The shadowy businessman behind a multibillion-dollar bank swindle. Chongqing monkeypox patient caught the disease in Berlin, China CDC says

Caixin Global

ZTO Express (2057 HK/ZTO US): Quality Speaks for Itself

Industry figures suggest express market to continue recover in Aug and ZTO Express is best benefited given its number one position. Upside of ASP...

Osbert Tang, CFA

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52-week Range

Market Cap (USDm)

P/E

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ZTO Express Q4/2022 Results & Guidance: Moderate Growth in '23, but Also Obstacles

ZTO guides strong volume growth and potentially better unit economics in '23, but we expect price pressure to return, and the company needs to rein...

Daniel Hellberg

CX Daily: Five Things to Know About China’s Latest IPO System Overhaul

Five things to know about China’s latest IPO system overhaul. Police say student missing for 100 days hanged himself. China completes provincial...

Caixin Global

ZTO Express (2057 HK/​​ZTO US): Solid Upward Momentum Stays Intact

ZTO's strong 3Q22 net profit growth and increased buyback program are both positive developments. It is also confident on the FY23 outlook as...

Osbert Tang, CFA

CX Daily: The Shadowy Businessman Behind a Multibillion-Dollar Bank Swindle

In Depth: The shadowy businessman behind a multibillion-dollar bank swindle. Chongqing monkeypox patient caught the disease in Berlin, China CDC says

Caixin Global

ZTO Express (2057 HK/​ZTO US): Quality Speaks for Itself

Industry figures suggest express market to continue recover in Aug and ZTO Express is best benefited given its number one position. Upside of ASP...

Osbert Tang, CFA

ZTO Express (2057 HK/ZTO US): Solid Upward Momentum Stays Intact

ZTO Express (2057 HK/ZTO US): Quality Speaks for Itself