NYSE:ZTO appears to be flying under the radar despite its strong fundamentals.

Discover ZTO EXPRESS CAYMAN INC-ADR (NYSE:ZTO)—an undervalued stock our stock screener has picked out. NYSE:ZTO demonstrates solid fundamentals, including health and profitability, all while staying attractively priced. Let's explore the details.

Assessing Valuation for NYSE:ZTO

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:ZTO was assigned a score of 7 for valuation:

• Based on the Price/Earnings ratio, ZTO is valued cheaply inside the industry as 82.35% of the companies are valued more expensively.
• ZTO's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.83.
• ZTO's Price/Forward Earnings ratio is rather cheap when compared to the industry. ZTO is cheaper than 94.12% of the companies in the same industry.
• ZTO is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.47, which is the current average of the S&P500 Index.
• Based on the Enterprise Value to EBITDA ratio, ZTO is valued a bit cheaper than 64.71% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, ZTO is valued a bit cheaper than the industry average as 70.59% of the companies are valued more expensively.
• ZTO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The excellent profitability rating of ZTO may justify a higher PE ratio.
• ZTO's earnings are expected to grow with 13.92% in the coming years. This may justify a more expensive valuation.

Profitability Insights: NYSE:ZTO

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:ZTO, the assigned 8 is noteworthy for profitability:

• ZTO's Return On Assets of 9.89% is amongst the best of the industry. ZTO outperforms 94.12% of its industry peers.
• With a decent Return On Equity value of 14.63%, ZTO is doing good in the industry, outperforming 70.59% of the companies in the same industry.
• With an excellent Return On Invested Capital value of 10.65%, ZTO belongs to the best of the industry, outperforming 82.35% of the companies in the same industry.
• The last Return On Invested Capital (10.65%) for ZTO is above the 3 year average (9.42%), which is a sign of increasing profitability.
• ZTO has a Profit Margin of 22.77%. This is amongst the best in the industry. ZTO outperforms 100.00% of its industry peers.
• Looking at the Operating Margin, with a value of 26.05%, ZTO belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
• The Gross Margin of ZTO (30.36%) is better than 64.71% of its industry peers.

Understanding NYSE:ZTO's Health

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:ZTO was assigned a score of 6 for health:

• An Altman-Z score of 4.34 indicates that ZTO is not in any danger for bankruptcy at the moment.
• The Altman-Z score of ZTO (4.34) is better than 76.47% of its industry peers.
• The Debt to FCF ratio of ZTO is 2.21, which is a good value as it means it would take ZTO, 2.21 years of fcf income to pay off all of its debts.
• ZTO's Debt to FCF ratio of 2.21 is amongst the best of the industry. ZTO outperforms 82.35% of its industry peers.
• A Debt/Equity ratio of 0.25 indicates that ZTO is not too dependend on debt financing.
• With a decent Debt to Equity ratio value of 0.25, ZTO is doing good in the industry, outperforming 70.59% of the companies in the same industry.
• ZTO has a Quick ratio of 1.34. This is in the better half of the industry: ZTO outperforms 64.71% of its industry peers.

How do we evaluate the Growth for NYSE:ZTO?

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:ZTO, the assigned 5 reflects its growth potential:

• The Earnings Per Share has grown by an impressive 23.98% over the past year.
• The Earnings Per Share has been growing by 12.36% on average over the past years. This is quite good.
• ZTO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.60%.
• Measured over the past years, ZTO shows a quite strong growth in Revenue. The Revenue has been growing by 16.89% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of ZTO

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.