What's in the Cards for ZTO Express (ZTO) in Q4 Earnings?

Core Viewpoint - ZTO Express is set to report its fourth-quarter 2023 results on March 19, with a history of outperforming earnings estimates, averaging a 17.31% beat over the last four quarters [1]. Group 1: Q4 Expectations - Fourth-quarter 2023 revenues for ZTO Express are anticipated to benefit from strong performance in the express delivery services unit [2]. - However, rising operating expenses, particularly in selling, general and administrative expenses (SG&A), are expected to negatively impact ZTO's profitability, with SG&A costs driven up by increases in compensation, benefits, and office expenditures [2]. - The Zacks Consensus Estimate for ZTO's fourth-quarter 2023 earnings has been revised downward by 7.5% over the past 90 days [2]. Group 2: Earnings Prediction Model - The current model does not predict a definitive earnings beat for ZTO Express, as it has an Earnings ESP of 0.00% and a Zacks Rank of 4 (Sell) [3]. - A combination of a positive Earnings ESP and a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) typically increases the likelihood of an earnings beat, which is not applicable in this case [3]. Group 3: Highlights of Q3 - In the third quarter of 2023, ZTO Express reported earnings of 39 cents per share, surpassing the Zacks Consensus Estimate of 36 cents, and showing year-over-year improvement [4]. - Total revenues for Q3 were $1,244 million, which fell short of the Zacks Consensus Estimate of$1,452.5 million [4].