Financial Survey: RXO (NYSE:RXO) versus ZTO Express (Cayman) (NYSE:ZTO)

RXO (NYSE:RXO) and ZTO Express (Cayman) (NYSE:ZTO) are both transportation companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Earnings and Valuation

This table compares RXO and ZTO Express (Cayman)”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RXO	$4.55 billion	0.59	-$290.00 million	($2.16)	-7.58
ZTO Express (Cayman)	$6.07 billion	1.82	$1.21 billion	$1.48	12.50

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

Profitability

This table compares RXO and ZTO Express (Cayman)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RXO	-5.45%	1.18%	0.57%
ZTO Express (Cayman)	18.83%	14.44%	9.72%

Risk and Volatility

RXO has a beta of 1.65, meaning that its stock price is 65% more volatile than the S&P 500. Comparatively, ZTO Express (Cayman) has a beta of -0.18, meaning that its stock price is 118% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for RXO and ZTO Express (Cayman), as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RXO	2	12	3	0	2.06
ZTO Express (Cayman)	0	3	3	1	2.71

RXO presently has a consensus price target of $17.23, suggesting a potential upside of 5.19%. ZTO Express (Cayman) has a consensus price target of $22.36, suggesting a potential upside of 20.90%. Given ZTO Express (Cayman)’s stronger consensus rating and higher probable upside, analysts clearly believe ZTO Express (Cayman) is more favorable than RXO.

Institutional and Insider Ownership

92.7% of RXO shares are owned by institutional investors. Comparatively, 41.7% of ZTO Express (Cayman) shares are owned by institutional investors. 1.5% of RXO shares are owned by company insiders. Comparatively, 41.3% of ZTO Express (Cayman) shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

ZTO Express (Cayman) beats RXO on 12 of the 14 factors compared between the two stocks.

About RXO

RXO, Inc. provides full truckload freight transportation brokering services. It also offers brokered services for managed transportation, last mile, and freight forwarding. The company was incorporated in 2022 and is based in Charlotte, North Carolina.

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.