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ZTO Express (ZTO) to Post Q2 Earnings: What's in the Offing?

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ZTO Express (ZTO - Free Report) is scheduled to report second-quarter 2021 earnings on Aug 18, after market close.

It does not have an impressive earnings surprise history, having missed estimates in three of the last four quarters, while surpassing the same in one occasion. It has a trailing four-quarter negative earnings surprise of 7.20%, on average. The Zacks Consensus Estimate for second-quarter earnings has been kept constant at 23 cents per share, in the past 60 days.

Let’s discuss the factors that might have impacted this Shanghai-based courier company’s June-quarter performance.

ZTO Express Cayman Inc. Price and EPS Surprise

 

ZTO Express Cayman Inc. Price and EPS Surprise

ZTO Express Cayman Inc. price-eps-surprise | ZTO Express Cayman Inc. Quote

 

ZTO Express’ higher selling, general and administrative expenses are anticipated to have hurt second-quarter bottom line.

Additionally, gross margin deterioration (due to intense competition-led decline in average selling prices) is expected to have hurt results.

However, the company's express delivery services unit is likely to have performed well in the second quarter on the back of strong parcel volumes.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for ZTO Express this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: ZTO Express has an Earnings ESP of 0.00%, as the Most Accurate Estimate is in line with the Zacks Consensus Estimate of 23 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: ZTO Express carries a Zacks Rank #3, currently.

Highlights of Q1 Earnings

ZTO Express’ first-quarter 2021 earnings (excluding 4 cents from non-recurring items) of 14 cents per share missed the Zacks Consensus Estimate by 4 cents. However, the bottom line increased 16.7% year over year. Total revenues of $987.9 million (RMB 6,473 million) increased in double digits year over year, owing to higher revenues in the core express delivery services unit (contributing 87.6% to the top line).

Sectorial Snapshots

Let’s look into some of the other recently-released earnings reports from companies within the Zacks Transportation  sector.

Knight-Swift Transportation Holdings (KNX - Free Report) , carrying a Zacks Rank #2, reported second-quarter 2021 earnings (excluding 6 cents from non-recurring items) of 98 cents per share. The figure surpassed the Zacks Consensus Estimate of 87 cents. Total revenues of $1,315.7 million also outperformed the Zacks Consensus Estimate of $1,300.8 million.

SkyWest (SKYW - Free Report) , currently flaunting a Zacks Rank #1, reported second-quarter 2021 earnings of $1.22 per share, beating the Zacks Consensus Estimate of 28 cents. The figure improved from the year-ago quarter’s loss of 51 cents. Revenues in the June quarter summed $657 million, surpassing the Zacks Consensus Estimate of $581.5 million and surging 87.7% year over year.

United Parcel Service (UPS - Free Report) , currently carrying a Zacks Rank #3, reported second-quarter 2021 earnings (excluding a penny from non-recurring items) of $3.06 per share. The figure beat the Zacks Consensus Estimate of $2.75. Quarterly revenues of $23,424 million also outperformed the Zacks Consensus Estimate of $23,085.4 million.

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