Goldman Sachs thinks it’s time to buy shares of China-based ZTO Express , as the company gains more market share. The bank upgraded the express delivery company to buy from neutral and raised its price target on the stock to $42 per share from $37. That equates to 50% upside from Monday’s closing price of $28.31. Goldman analyst Ronald Keung expects the company to gain about 1.5% of market share compared to peer express delivery stocks like YTO Express , and thinks the company’s valuation is attractive at 18 times 2023 earnings. “We expect the top 2 express players to gain further share and like both ZTO and YTO, as we believe both are well positioned in this competitive environment where service quality/quality growth has become the priority,” Keung said. Competition has also eased in the sector, Keung added, with Yunda Express falling this year to third in terms of market share. “With our estimate changes, we are now 1-4% above consensus for top line over 2023-24E and 1-6% above for net profit, and introduce our 2025E forecasts,” Keung said. U.S.-listed shares of ZTO Express are up just 4% year to date. However, the stock has rallied 58% over the past six months. ZTO YTD mountain Goldman Sachs thinks express shipping company ZTO can gain further market share on competitors and continue a compelling growth story. — CNBC’s Michael Bloom contributed to this report.
