JPMorgan Upgrades ZTO Express (Cayman) (ZTO) Stock, Reduces PT

On May 29, JPMorgan analyst Lin Chen upped ZTO Express (Cayman) Inc. (NYSE:ZTO)’s stock from “Neutral” to “Overweight,” and reduced the price objective to $21.00 from the prior target of $23.00.

JPMorgan Upgrades ZTO Express (Cayman) (ZTO) Stock, Reduces PT

A fleet of trucks speeding along an interstate highway delivering goods to distant customers.

The analyst believes that the cut-throat competition in the broader industry can result in consolidation in H2 2025. ZTO Express (Cayman) Inc. (NYSE:ZTO), which has been tagged as a leading company, is anticipated to remain resilient and potentially benefit due to this consolidation.

This can be possible mainly through its efforts to reduce costs. Furthermore, JPMorgan believes that the upcoming inclusion of ZTO Express (Cayman) Inc. (NYSE:ZTO) in the Hang Seng Index as a blue-chip stock can help improve liquidity and favourably affect the investor sentiments. This inclusion will be effective on June 6, 2025, after the market closes. Overall, the firm expects an improved risk/reward at the current price levels.

As per the analyst, the decline in industry’s average selling price (ASP) continues to put significant pressure on the lower-tier Tongda players. However, ZTO Express (Cayman) Inc. (NYSE:ZTO) is being seen at an advantageous position. If the pricing continues to decline, some companies might face losses because of their limited capacity for cost reduction, unlike Tier 1 players such as ZTO Express (Cayman) Inc. (NYSE:ZTO), contends Chen.

ZTO Express (Cayman) Inc. (NYSE:ZTO) offers express delivery and other value-added logistics services.

While we acknowledge the potential of ZTO to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk.  If you are looking for an AI stock that is more promising than ZTO and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.