Full Truck Alliance Co. Ltd. (YMM): A Bull Case Theory

We came across a bullish thesis on Full Truck Alliance Co. Ltd. on Valueinvestorsclub.com by zyos. In this article, we will summarize the bulls’ thesis on YMM. Full Truck Alliance Co. Ltd.'s share was trading at $10.09 as of January 13th. YMM’s trailing and forward P/E were 18.52 and 19.49, respectively according to Yahoo Finance.

Full Truck Alliance (FTA) is China’s dominant digital freight platform, controlling roughly 70% of the online truck freight market in a sector that remains structurally underpenetrated, with online adoption below 10% of an estimated RMB 5.5 trillion addressable spot and contracted road freight market.

Built to disrupt an archaic, inefficient offline system, FTA offers a markedly superior value proposition through transparent pricing, faster matching, reduced empty miles, and access to over 4 million active truckers nationwide, enabling shippers to cut freight costs by 10–15% while dramatically shortening fulfillment times. Its scale and dense nationwide network, spanning 300+ cities and over 100,000 routes, create powerful network effects that competitors have struggled to replicate.

FTA’s core monetization is increasingly driven by transaction commissions, which carry higher margins and benefit from growing penetration, increased contribution from higher-take-rate intracity and LTL services, and a gradual shift toward direct shippers who value reliability over marginal price savings.

As management deliberately deprioritizes low-margin freight brokerage and tightens its value-added credit business amid regulatory changes, the company is experiencing a sharp margin inflection, with EBIT margins expanding rapidly on operating leverage despite moderating revenue growth. The asset-light model generates strong returns on invested capital, while excess cash continues to depress headline ROE.

Competition from players like Huolala remains largely segmented by use case, with FTA firmly entrenched in intercity full truckload freight, where rivals have failed to gain traction. While macro softness, regulatory intervention, or shifts toward contracted logistics pose risks, FTA’s limited penetration of its addressable market leaves substantial runway for continued consolidation. Trading at a mid-teens multiple on forward earnings, the investment case rests on sustained mix-driven earnings growth as digital freight adoption accelerates and FTA further entrenches itself as the industry’s central marketplace.

Previously, we covered a bullish thesis on GXO Logistics, Inc. (GXO) by Busy Investor Stock Reports in February 2025, which highlighted short-term headwinds, strong customer expansion, and AI-driven operational efficiency. GXO’s stock price has appreciated by approximately 46.44% since our coverage. This is because execution remained strong as temporary issues faded. zyos shares a similar perspective but emphasizes platform scale, network effects, and margin inflection in digital freight.

Full Truck Alliance Co. Ltd. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 30 hedge fund portfolios held YMM at the end of the third quarter which was 35 in the previous quarter. While we acknowledge the potential of YMM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.