ZTO Express Inc.’s ZTO second-quarter 2020 earnings of 26 cents per share (RMB 1.85) missed the Zacks Consensus Estimate of 28 cents. Nevertheless, the bottom line increased 4% year over year. Results were driven by rise in parcel volume market share by 1.6 percentage points to 21.5%.
Total revenues of $906.2 million (RMB 6,402.4 million) also rose 14.7% year over year. The upside can be attributed to increase in revenues at the core express delivery services unit, which contributed significantly to the top line.
ZTO Express Cayman Inc. Price, Consensus and EPS Surprise
ZTO Express Cayman Inc. price-consensus-eps-surprise-chart | ZTO Express Cayman Inc. Quote
Detailed Operational Statistics
Revenues in Express delivery services increased 16.3% year over year, owing to 47.9% rise in parcel volume. Favorable pricing also drove segmental results. Freight forwarding services revenues, inched up 33.4% year over year, owing to increase in cross-border e-commerce demand amid coronavirus concerns. Also, revenues from sales of accessories increased 9.8% year over year.
Meanwhile, total operating expenses of this China-based company declined 55.5% to RMB 122.6 million. Selling, general and administrative expenses increased 2.3% year over year. Gross margin deteriorated to 27.6% in the second quarter from 32.6% in the year-ago quarter. As of Jun 30, 2020, ZTO Express repurchased 7.7 million ADSs at average price of $17.33.
ZTO Express, carrying a Zacks Rank # 3 (Hold), exited the second quarter with cash and cash equivalents of RMB 5.26 billion compared with RMB 5.27 billion at the end of 2019. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ZTO Express now expects parcel volumes in the range of 16.2-17 billion for 2020 (previous guidance: 15.9-16.4 billion). The increased annual parcel volume projection indicates 33.7-40.3% increase on a year-over-year basis. Additionally, adjusted net income is anticipated between RMB 4.8 billion and RMB 5.2 billion, which indicates 1.7-9.3% fall year over year.
Let’s take a look into some other Zacks Transportation sector companies’ second-quarter results.
Canadian National’s CNI second-quarter 2020 earnings (excluding 36 cents from non-recurring items) of 92 cents per share (C$0.77) were in line with the Zacks Consensus Estimate. However, the bottom line declined 28.7% year over year. Quarterly revenues of $2,315 million (C$3,209 million) missed the Zacks Consensus Estimate of $2,407.6 million and fell 21.8% year over year.
J.B. Hunt Transport JBHT reported second-quarter 2020 earnings of $1.14 per share that surpassed the Zacks Consensus Estimate by 31 cents. Total revenues of $2,145.6 million beat the Zacks Consensus Estimate of $2,060.9 million.
Kansas City Southern’s KSU second-quarter earnings (excluding a penny from non-recurring items) of $1.15 per share beat the Zacks Consensus Estimate of $1.12. Total revenues of $547.9 million lagged the consensus mark of $550.2 million.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech 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
Canadian National Railway Company (CNI) : Free Stock Analysis Report
Kansas City Southern (KSU) : Free Stock Analysis Report
J.B. Hunt Transport Services, Inc. (JBHT) : Free Stock Analysis Report
ZTO Express Cayman Inc. (ZTO) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research