ZTO: Future Parcel Volume Expansion And Buybacks Will Drive Upside Potential

The analyst price target for ZTO Express (Cayman) has been modestly reduced to approximately $27.26 from about $28.15, as analysts factor in slightly slower expected revenue growth and a higher discount rate, partly offset by improved profit margin forecasts and a lower assumed future P/E multiple.

What's in the News

• Completed a major share repurchase program, buying back a total of 52,919,506 shares, about 6.5% of shares outstanding, for approximately $1.3 billion under the buyback first announced in November 2018 (company disclosure)
• Between July 1 and September 30, 2025, repurchased an additional 2,020,008 shares, roughly 0.25% of shares outstanding, for $71.7 million as the final tranche of the long running program (company disclosure)
• Issued 2025 parcel volume guidance of 38.2 billion to 38.7 billion parcels, implying year over year growth of 12.3% to 13.8% in shipment volume (company guidance)
• Scheduled a board meeting for November 19, 2025, to review and approve unaudited third quarter 2025 financial results and authorize their publication (board meeting notice)

Valuation Changes

• Fair Value Estimate was reduced slightly from $28.15 to $27.26 per share, reflecting more conservative growth assumptions.
• The Discount Rate rose modestly from 8.17% to 8.44%, increasing the required return applied to future cash flows.
• Revenue Growth was lowered from about 16.83% to 14.90%, indicating expectations for somewhat slower top line expansion.
• Net Profit Margin improved from roughly 19.60% to 20.49%, incorporating expectations for better operating efficiency.
• Future P/E was trimmed from about 14.07x to 13.21x, implying a slightly more conservative valuation multiple on projected earnings.