Corporate Logo(source: cjlogistics.com)
NH Investment & Securities said on August 11 that CJ Logistics (000120) maintains its long-term growth drivers, but falling parcel delivery rates are expected to delay valuation expansion. The brokerage kept its “Buy” rating but lowered its target price to 115,000 won. The stock closed at 87,200 won in the previous session.
Jeong Yeon-seung, an analyst at NH Investment & Securities, noted, “Second-quarter results were disappointing due to simultaneous declines in parcel volume and unit prices. In the third quarter, volumes are expected to rise, but the drop in unit prices is likely to widen. While the core investment points remain intact, the recovery in parcel earnings will take time, prompting us to revise our target price downward.”
Jeong added that price promotions aimed at expanding the adoption of seven-day-a-week delivery are expected to accelerate the decline in parcel rates in the second half. Considering the sluggish pace of improvement in the parcel segment, the analyst lowered the company’s 2024 operating profit forecast by 10%.
Nevertheless, Jeong maintained that the long-term investment case—expansion of parcel market share through seven-day-a-week delivery, integration with fulfillment demand, and the structural growth of the warehousing and distribution (W&D) segment—remains valid through 2026.
However, Jeong also cautioned that during the rollout of new services, parcel rates could fall more sharply than anticipated, offsetting potential gains from an expected recovery in shipment volumes driven by stronger consumer demand in the second half. With a year-on-year earnings decline seen as inevitable, valuation expansion is expected to take longer.
In the second quarter, CJ Logistics reported revenue of 3.0484 trillion won, down 0.4% year-on-year, and operating profit of 115.2 billion won, an 8.1% decline, both slightly below market estimates. Parcel volumes fell 3.8% from a year earlier, while unit prices dropped 1.3%.
Although rates for major large-scale clients increased, declines among small- and medium-sized clients were more severe than expected, dragging down overall parcel pricing. In the second half, continued promotional activities and a higher share of small-parcel deliveries are expected to deepen the rate decline.
In the contract logistics (CL) segment, strong warehouse demand boosted revenue by 13% year-on-year to 833.4 billion won, but the operating margin of 5.4% indicated a slow improvement pace due to stabilization costs from new contract rollouts.
In the global business segment, U.S.-bound battery shipment volumes fell, limiting revenue growth to 1.6% year-on-year. However, solid profitability in the forwarding division led to an improvement in operating profit compared with the previous quarter.
*[KOSPI]CJ Logistics(000120) is composed of CL business, Parcel delivery business, Global business, and Construction business. It has the sole direct management organization in South Korea, with 30,000 parcel handling points and approximately 20,000 delivery drivers. Market capitalization is 1.989 trillion won(as of August 8, 2025, closing price).
Corporate Logo(source: cjlogistics.com)
NH Investment & Securities said on August 11 that CJ Logistics (000120) maintains its long-term growth drivers, but falling parcel delivery rates are expected to delay valuation expansion. The brokerage kept its “Buy” rating but lowered its target price to 115,000 won. The stock closed at 87,200 won in the previous session.
Jeong Yeon-seung, an analyst at NH Investment & Securities, noted, “Second-quarter results were disappointing due to simultaneous declines in parcel volume and unit prices. In the third quarter, volumes are expected to rise, but the drop in unit prices is likely to widen. While the core investment points remain intact, the recovery in parcel earnings will take time, prompting us to revise our target price downward.”
Jeong added that price promotions aimed at expanding the adoption of seven-day-a-week delivery are expected to accelerate the decline in parcel rates in the second half. Considering the sluggish pace of improvement in the parcel segment, the analyst lowered the company’s 2024 operating profit forecast by 10%.
Nevertheless, Jeong maintained that the long-term investment case—expansion of parcel market share through seven-day-a-week delivery, integration with fulfillment demand, and the structural growth of the warehousing and distribution (W&D) segment—remains valid through 2026.
However, Jeong also cautioned that during the rollout of new services, parcel rates could fall more sharply than anticipated, offsetting potential gains from an expected recovery in shipment volumes driven by stronger consumer demand in the second half. With a year-on-year earnings decline seen as inevitable, valuation expansion is expected to take longer.
In the second quarter, CJ Logistics reported revenue of 3.0484 trillion won, down 0.4% year-on-year, and operating profit of 115.2 billion won, an 8.1% decline, both slightly below market estimates. Parcel volumes fell 3.8% from a year earlier, while unit prices dropped 1.3%.
Although rates for major large-scale clients increased, declines among small- and medium-sized clients were more severe than expected, dragging down overall parcel pricing. In the second half, continued promotional activities and a higher share of small-parcel deliveries are expected to deepen the rate decline.
In the contract logistics (CL) segment, strong warehouse demand boosted revenue by 13% year-on-year to 833.4 billion won, but the operating margin of 5.4% indicated a slow improvement pace due to stabilization costs from new contract rollouts.
In the global business segment, U.S.-bound battery shipment volumes fell, limiting revenue growth to 1.6% year-on-year. However, solid profitability in the forwarding division led to an improvement in operating profit compared with the previous quarter.
*[KOSPI]CJ Logistics(000120) is composed of CL business, Parcel delivery business, Global business, and Construction business. It has the sole direct management organization in South Korea, with 30,000 parcel handling points and approximately 20,000 delivery drivers. Market capitalization is 1.989 trillion won(as of August 8, 2025, closing price).