We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ZTO Express Down 18.7% Y/Y: Will the Plunge Continue Throughout 2025?
Read MoreHide Full Article
Key Takeaways
{\"0\":\"ZTO\'s earnings estimates for 2025 have been revised lower, signaling weak broker confidence.\",\"1\":\"ZTO cut its 2025 parcel volume forecast to 38.8-40.1 billion from the prior 40.8-42.2 billion.\",\"2\":\"ZTO shares have lost 18.7% over the past year, underperforming the broader trucking industry.\"}
Shares of ZTO Express (ZTO - Free Report) have had an unimpressive run in a year. Shares of this company have plunged 18.7% in the same period, underperforming the transportation-services industry’s14.5% decline.
ZTO Stock's One-Year Price Comparison
Image Source: Zacks Investment Research
Given the unimpressive price performance, let's take a deeper dive into the factors driving this transportation stock’s decline. In this write-up, we also assess whether ZTO, currently carrying a Zacks Rank #4 (Sell), is likely to suffer more going forward.
ZTO Express continues to grapple with increasing pressure on its bottom line due to rising expenses, which are challenging its financial stability. In 2024, the company experienced a 14.2% year-over-year increase in total cost of revenues. In the first half of 2025, ZTO witnessed a 21.5% year-over-year increase in total cost of revenues. This rise was largely driven by higher sorting hub operating costs and other related expenses.
Based on current market and operating conditions, ZTO Express lowered its 2025 parcel volume guidance to the range of 38.8 billion to 40.1 billion (reflecting 14-18% year-over-year growth) from the previously guided range of 40.8 billion to 42.2 billion (reflecting 20-24% year-over-year growth).
The domestic express delivery market is highly competitivedue to the presence of major players such as SF Express and STO Express. The company’s stock price may decrease if competition intensifies and becomes a hindrance.
Southward Earnings Estimate Revision: The Zacks Consensus Estimate for 2025 earnings has moved 4.52% south in the past 60 days. For 2026, the consensus mark for earnings has been revised 2.35% downward in the same time frame. The unfavorable estimate revisions indicate brokers’ lack of confidence in the stock.
Earnings Expectations: Downbeat earnings expectations cast a shadow over a company’s prospects. For 2025, ZTO’s earnings are expected to decline 11.38% year over year.
Bearish Industry Rank
The industry to which ZTO belongs currently has a Zacks Industry Rank of 206 (out of 248 groups). Such a weak rank places the industry in the bottom 16% of the Zacks industries. Studies have shown that 50% of a stock price movement is directly tied to the performance of the industry group that it hails from.
In fact, a robust stock in a weak industry is likely to underperform an ordinary stock in a strong group. Therefore, considering the industry’s performance becomes imperative.
LTM has an expected earnings growth rate of 45% 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, missed once and met in the remaining one, delivering an average beat of 4.04%.
SKYW currently sports a Zacks Rank #1.
SkyWest has an expected earnings growth rate of 28.06% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.92%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ZTO Express Down 18.7% Y/Y: Will the Plunge Continue Throughout 2025?
Key Takeaways
Shares of ZTO Express (ZTO - Free Report) have had an unimpressive run in a year. Shares of this company have plunged 18.7% in the same period, underperforming the transportation-services industry’s14.5% decline.
ZTO Stock's One-Year Price Comparison
Image Source: Zacks Investment Research
Given the unimpressive price performance, let's take a deeper dive into the factors driving this transportation stock’s decline. In this write-up, we also assess whether ZTO, currently carrying a Zacks Rank #4 (Sell), is likely to suffer more going forward.
ZTO Express continues to grapple with increasing pressure on its bottom line due to rising expenses, which are challenging its financial stability. In 2024, the company experienced a 14.2% year-over-year increase in total cost of revenues. In the first half of 2025, ZTO witnessed a 21.5% year-over-year increase in total cost of revenues. This rise was largely driven by higher sorting hub operating costs and other related expenses.
Based on current market and operating conditions, ZTO Express lowered its 2025 parcel volume guidance to the range of 38.8 billion to 40.1 billion (reflecting 14-18% year-over-year growth) from the previously guided range of 40.8 billion to 42.2 billion (reflecting 20-24% year-over-year growth).
The domestic express delivery market is highly competitivedue to the presence of major players such as SF Express and STO Express. The company’s stock price may decrease if competition intensifies and becomes a hindrance.
Southward Earnings Estimate Revision: The Zacks Consensus Estimate for 2025 earnings has moved 4.52% south in the past 60 days. For 2026, the consensus mark for earnings has been revised 2.35% downward in the same time frame. The unfavorable estimate revisions indicate brokers’ lack of confidence in the stock.
Earnings Expectations: Downbeat earnings expectations cast a shadow over a company’s prospects. For 2025, ZTO’s earnings are expected to decline 11.38% year over year.
Bearish Industry Rank
The industry to which ZTO belongs currently has a Zacks Industry Rank of 206 (out of 248 groups). Such a weak rank places the industry in the bottom 16% of the Zacks industries. Studies have shown that 50% of a stock price movement is directly tied to the performance of the industry group that it hails from.
In fact, a robust stock in a weak industry is likely to underperform an ordinary stock in a strong group. Therefore, considering the industry’s performance becomes imperative.
Stocks to Consider
Investors interested in the Zacks Transportation sector may also consider LATAM Airlines Group (LTM - Free Report) and SkyWest (SKYW - Free Report) .
LTM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
LTM has an expected earnings growth rate of 45% 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, missed once and met in the remaining one, delivering an average beat of 4.04%.
SKYW currently sports a Zacks Rank #1.
SkyWest has an expected earnings growth rate of 28.06% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.92%.