Contrasting ZTO Express (Cayman) (NYSE:ZTO) & Expeditors International of Washington (NASDAQ:EXPD)

Expeditors International of Washington (NASDAQ:EXPD) and ZTO Express (Cayman) (NYSE:ZTO) are both large-cap industrials companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.

Profitability

This table compares Expeditors International of Washington and ZTO Express (Cayman)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Expeditors International of Washington	7.64%	36.16%	16.88%
ZTO Express (Cayman)	19.03%	15.90%	10.89%

Dividends

Expeditors International of Washington pays an annual dividend of $1.62 per share and has a dividend yield of 0.8%. ZTO Express (Cayman) pays an annual dividend of $0.76 per share and has a dividend yield of 3.8%. Expeditors International of Washington pays out 23.6% of its earnings in the form of a dividend. ZTO Express (Cayman) pays out 40.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Expeditors International of Washington has increased its dividend for 31 consecutive years.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Expeditors International of Washington and ZTO Express (Cayman), as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Expeditors International of Washington	3	9	2	1	2.07
ZTO Express (Cayman)	0	4	1	1	2.50

Expeditors International of Washington presently has a consensus target price of $175.27, suggesting a potential downside of 11.23%. ZTO Express (Cayman) has a consensus target price of $24.70, suggesting a potential upside of 22.54%. Given ZTO Express (Cayman)’s stronger consensus rating and higher probable upside, analysts clearly believe ZTO Express (Cayman) is more favorable than Expeditors International of Washington.

Risk & Volatility

Expeditors International of Washington has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, ZTO Express (Cayman) has a beta of -0.19, meaning that its stock price is 119% less volatile than the S&P 500.

Insider and Institutional Ownership

94.0% of Expeditors International of Washington shares are held by institutional investors. Comparatively, 41.7% of ZTO Express (Cayman) shares are held by institutional investors. 0.5% of Expeditors International of Washington shares are held by insiders. Comparatively, 41.3% of ZTO Express (Cayman) shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Expeditors International of Washington and ZTO Express (Cayman)”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Expeditors International of Washington	$12.04 billion	2.13	$752.88 million	$6.87	28.74
ZTO Express (Cayman)	$54.21 billion	0.21	$1.30 billion	$1.86	10.84

ZTO Express (Cayman) has higher revenue and earnings than Expeditors International of Washington. ZTO Express (Cayman) is trading at a lower price-to-earnings ratio than Expeditors International of Washington, indicating that it is currently the more affordable of the two stocks.

Summary

Expeditors International of Washington beats ZTO Express (Cayman) on 10 of the 17 factors compared between the two stocks.

About Expeditors International of Washington

Expeditors International of Washington, Inc., together with its subsidiaries, provides logistics services worldwide. The company offers airfreight services, such as air freight consolidation and forwarding; ocean freight and ocean services, including ocean freight consolidation, direct ocean forwarding, and order management; customs brokerage, import, intra-continental ground transportation and delivery, and warehousing and distribution services; and customs clearance, purchase order management, vendor consolidation, time-definite transportation services, temperature-controlled transit, cargo insurance, specialized cargo monitoring and tracking, and other supply chain solutions. It also provides optimization, trade compliance consulting, cargo security, and solutions. In addition, it acts as a freight consolidator or as an agent for the airline that carries the shipment. Further, the company provides ancillary services that include preparation of shipping and customs documentation, packing, crating, insurance services, and the preparation of documentation to comply with local import and export laws. Its customers include retailing and wholesaling, electronics, technology, and industrial and manufacturing companies. The company was incorporated in 1979 and is headquartered in Seattle, Washington.

About ZTO Express (Cayman)

ZTO Express (Cayman) Inc. provides express delivery and other value-added logistics services in the People's Republic of China. It offers freight forwarding services; and delivery services for e-commerce and traditional merchants, and other express service users. The company was founded in 2002 and is headquartered in Shanghai, the People's Republic of China.