Macquarie upgrades ZTO Express on better unit economics

Macquarie upgraded ZTO Express (ZTO) to Outperform from Neutral with a price target of $26.60, up from $18.40. Even in a “tough” macro environment, ZTO should post above-industry volume growth given its value proposition under shifting pricing preferences, the analyst tells investors in a research note. The firm says the issuance of a convertible senior note allows ZTO to boost shareholder returns through both share buybacks and dividends. Macquarie thinks the company’s unit economics will improve given anti-involution policies and solid shareholder returns.