China's logistics sector has entered a quality-driven recovery phase, with YMM and J&T becoming the preferred names for the next stage

Overview

This is a JPMorgan 2Q26 earnings preview for China's logistics, express parcel, and e-commerce sectors. The report's core view is that the industry is shifting from "trading price for volume" to more sustainable quality- and margin-driven growth. Anti-involution policies, pricing discipline, technology upgrades, and business mix optimization are jointly supporting industry profit recovery. June industry data and earnings preannouncements from the Tongda operators both validate this direction, although e-commerce demand and company performance remain differentiated.

Core views

The report maintains a broadly positive view on China's logistics sector for 2H26, but believes stock priorities for the next 3–6 months have been reshuffled: YMM and J&T are now the top picks, followed by ZTO, JD Logistics, and SF. ZTO is expected to continue outperforming the industry; JD Logistics should still post strong revenue and operating profit, though non-IFRS net profit is pressured by one-off factors; J&T reached a record parcel volume with strong profit growth; SF supports ASP through a quality-first strategy but profits are affected by a high base; and YMM is seeing solid order growth, with commission revenue emerging as a highlight.

Analysis framework

The report cross-validates industry pricing, parcel volume, revenue, margins, and stock rankings by combining monthly express delivery operating data, e-commerce GMV and category data, A-share Tongda operators' earnings preannouncements, 2Q26 company earnings expectations, share price performance, and comparable-company valuations.

Methodology notes

• Industry cycle and competitive landscapeQuality-driven recovery framework

  Shifting from parcel-volume priority to revenue, ASP, and margin priority

  The report uses revenue growth outpacing parcel volume growth, ASP recovery, and improved earnings preannouncements to judge that the industry is moving from destructive price competition toward more rational quality growth.

• Valuation methodsTarget P/E multiple method

  Setting target prices based on forward EPS and target P/E

  JD Logistics' Jun-27 target price of HK$17.0 is based on 2027 non-IFRS EPS and a 9x target P/E; YMM's Jun-27 target price of US$11.0 is based on non-GAAP EPS and a 15x target P/E.

• Earnings preview2Q26 earnings preview

  Inferring quarterly profit trends from operating indicators and earnings preannouncements

  Based on earnings preannouncements from YTO, STO, and Yunda, as well as parcel volume, revenue, ASP, commissions, and one-off items for ZTO, JDL, J&T, SF, and YMM, the report assesses 2Q26 profit differentiation.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• YMM / Full Truck Alliance

  One of the top picks; China's digital intercity road freight platform

  Strengths

  Fulfilled orders are expected to grow 11–14% YoY, transaction commission revenue is expected to grow about 33% YoY, the platform model is relatively resilient, and risk-reward has improved after valuation expectations were revised down.

  Weaknesses

  Total revenue is expected to decline about 4% YoY, business restructuring continues to drag on headline growth, and non-GAAP net profit is expected to be flat.

  Comparison

  The report upgrades YMM to one of the sector's top picks for the next 3–6 months and raises the Jun-27 target price from US$10.00 to US$11.00.

  Risks

  Macro weakness, regulatory changes in road freight, intensifying competition among digital freight platforms, and China ADR delisting risk.

• J&T Express - H / 1519.HK

  One of the top picks; express delivery platform

  Strengths

  2Q26 group parcel volume rose 24% YoY to 9.18B, average daily parcel volume exceeded 100MM for the first time, non-IFRS net profit is expected to rise more than 50% YoY, and expansion in new markets plus scale effects are notable.

  Weaknesses

  Rapid expansion places higher demands on execution, cost control, and profit delivery in new markets.

  Comparison

  The report believes J&T, together with YMM, will lead the sector's next phase, with a target price of HK$13.00, implying about 36% upside from the current price.

  Risks

  Parcel volume growth below expectations, a return of price competition, and slower-than-expected profit improvement in new markets.

• ZTO Express - H / 2057.HK

  High-quality leader and steady compounder

  Strengths

  2Q26 parcel volume growth is expected to exceed the industry's roughly 4% level, with operating profit up 30–40% YoY, supported by reverse logistics and market share gains.

  Weaknesses

  As a mature leader, further outsized growth requires continued share expansion and margin delivery.

  Comparison

  The report ranks ZTO behind YMM and J&T, but still views it as the most stable compounding company in the sector.

  Risks

  A renewed industry price war, parcel volume growth below expectations, and cost control falling short of expectations.

• JD Logistics / 2618.HK

  Overweight; integrated supply chain logistics and e-commerce logistics platform

  Strengths

  2Q26 revenue is expected to rise 20–25% YoY to Rmb62–64B, with strong core logistics and internal ISC businesses, and operating profit is expected to grow at a double-digit rate.

  Weaknesses

  Non-IFRS net profit may be flat YoY due to one-off factors such as interest income, government subsidies, and FX losses; target price is cut from HK$20.00 to HK$17.00.

  Comparison

  The stock remains Overweight, but ranks behind YMM and J&T within the sector.

  Risks

  JD.com GMV growth weaker than expected, and weaker-than-expected macro recovery pressuring the external ISC business.

• SF Holding - H / 6936.HK

  Overweight; leader in high-quality express delivery and integrated logistics

  Strengths

  A quality-first strategy supported 2Q26 ASP growth of 5.1% YoY to Rmb14.1, while revenue posted slight YoY growth.

  Weaknesses

  Parcel volume fell 4% YoY, and the high base plus business mix adjustments may lead to a double-digit YoY decline in 2Q26 net profit.

  Comparison

  The report still rates SF Overweight, but ranks it behind YMM, J&T, ZTO, and JD Logistics.

  Risks

  Weakening demand for premium parcels, slower-than-expected business mix adjustments, and persistent pressure from a high profit base.

• YTO / STO / Yunda

  Representatives of earnings recovery among A-share Tongda operators

  Strengths

  2Q26 implied net profit rose 92%, 152%, and 136% YoY, respectively, with anti-involution measures, pricing discipline, AI, and digital upgrades driving margin improvement.

  Weaknesses

  Company strategies are clearly diverging; Yunda is placing more emphasis on margins than volume, putting short-term pressure on market share.

  Comparison

  STO and YTO continued gaining share in June, while Yunda sacrificed some share in exchange for higher-quality business.

  Risks

  Unsustained price recovery, cost improvements below expectations, and an uneven recovery in industry demand.

Key data

• June express delivery industry parcel volume17.51B parcels, +3.8% YoYThe 6.18 shopping festival provided moderate support.
• June express delivery industry revenueRmb136B, +7.7% YoYRevenue growth outpaced parcel volume growth, indicating improved monetization.
• June express delivery industry ASPRmb7.77, +3.8% YoYPrice recovery continued, reflecting more rational competition.
• YTO 2Q26 implied net profit growth+92% YoY1H26 net profit midpoint of about Rmb3.25B, +78% YoY.
• STO 2Q26 implied net profit growth+152% YoY1H26 net profit midpoint of about Rmb1.01B, +122% YoY.
• Yunda 2Q26 implied net profit growth+136% YoY1H26 net profit midpoint of about Rmb978MM, +85% YoY.
• JD Logistics 2Q26 revenue expectationRmb62–64B, +20–25% YoYOperating profit is expected to grow at a double-digit rate, while non-IFRS net profit may be flat YoY.
• J&T 2Q26 parcel volume9.18B parcels, +24% YoYAverage daily volume exceeded 100MM for the first time, and non-IFRS net profit is expected to grow more than 50% YoY.
• SF 2Q26 express revenue and ASPRevenue Rmb57.85B, +1% YoY; ASP Rmb14.1, +5.1% YoYThe company is prioritizing margins and service quality, while parcel volume fell 4% YoY.
• YMM 2Q26 fulfilled orders67.5–69.3MM orders, +11–14% YoYTransaction commission revenue is expected to grow about 33% YoY, but total revenue is expected to decline about 4% YoY due to business restructuring.

Impact & implications

For investors, the report's main implication is that confidence in industry earnings recovery is increasing. The market is no longer rewarding only a single sector leader, but is beginning to re-rate multiple companies with pricing discipline, platform monetization, scale expansion, and margin elasticity. However, demand has not yet fully recovered, and category divergence in e-commerce plus macro volatility mean the sector's upside still requires further data confirmation.

Risks

• E-commerce and macro demand recovery is incomplete, with online services GMV still in negative growth and weaker categories such as daily necessities.
• If anti-involution measures and pricing discipline weaken, the industry may re-enter price competition and compress margins.
• Differences in business mix, one-off items, and execution across companies may lead to divergent 2Q26 earnings.
• If JD.com GMV is weaker than expected, it will affect JD Logistics earnings forecasts.
• YMM faces macro, regulatory, competitive, and China ADR delisting risks.
• SF is affected by a high base and business mix adjustments, and short-term profits may remain under pressure.

What to watch

• Whether express delivery industry ASP can continue to recover YoY in 2H26.
• Whether YMM's transaction commission revenue growth can offset the drag from business restructuring on total revenue.
• Whether J&T can deliver upside to its full-year US$700MM non-IFRS net profit guidance.
• Whether ZTO's parcel volume and operating profit continue to outperform the industry.
• After the impact of one-off items fades, whether JD Logistics non-IFRS net profit can return to growth.
• Whether the recovery in e-commerce physical goods GMV broadens from pockets such as communication equipment and food into a wider range of categories.