Goldman Sachs Downgrades ZTO Express (ZTO) to Neutral

Goldman Sachs analyst Ronald Keung downgraded ZTO Express (NYSE: ZTO) from Buy to Neutral with a price target of $22.00 (from $25.00).

The analyst comments: “Downgrade to Neutral, in line with our more cautious stance on franchised express-delivery operators. While we expect ZTO, as China's largest franchised-based express operator, will continue to deliver higher-than-peers daily volume and uphold a relative unit economics advantage, we note it faces a challenging industry-wide operating backdrop from worsening supply-demand imbalances, and idiosyncratic challenges including slower-than-expected consolidation progress (its 20% volume share has remained largely stable since 2021) and emerging competitive pressures (with YTO Express continuing to narrow the gap with ZTO in both market share and unit economics). Meanwhile, while ZTO's unit economics remained near record levels in 2Q26, we see limited scope for further upside as the benefits of anti-involution policies that drove earnings acceleration in 3Q25-2Q26 are likely to turn into challenging comps over the next few quarters. In addition, any potential further reduction by Alibaba of its ZTO stake following its recent stake cut (25mn shares for US$500mn on Sept 21), could create a technical overhang as it currently still holds 6.1% stake in ZTO.”

For an analyst ratings summary and ratings history on ZTO Express click here. For more ratings news on ZTO Express click here.

Shares of ZTO Express closed at $20.36 yesterday.

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