On May 22, 2025, BofA Securities analyst Fan Tso downgraded ZTO Express (NYSE: ZTO) from “Buy” to “Neutral,” accompanied by a revised price target of $19, down from $24.
📌 The downgrade reflects a more cautious outlook on ZTO’s growth trajectory amid evolving market conditions. Despite the company’s strong position in China’s express delivery market, the adjustment signals tempered expectations for performance due to mounting competition and signs of margin pressure.
📌 Analysts point to rising operational costs and declining revenue per parcel as key concerns. While ZTO continues to gain market share, the pace of profitability improvement appears slower than previously anticipated. The muted guidance issued in the latest earnings report further reinforced skepticism over short-term upside potential.
📌 From a dividend perspective, ZTO Express maintains a stable profile. The company offers a forward dividend yield of approximately 3.68%, supported by a payout ratio of around 43.1%. This suggests that the dividend remains sustainable and should continue to offer investors consistent income, even amid near-term turbulence.
ZTO’s fundamentals remain sound, but the downgrade serves as a reminder that even market leaders must continuously adapt to shifting industry landscapes to maintain their edge.