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J.B. Hunt (JBHT) Stock Falls on Q2 Earnings, Sales Miss
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J.B. Hunt Transport Services Inc. (JBHT - Free Report) performed disappointingly in the second quarter of 2017, reporting lower-than-expected earnings as well as revenues.
This transportation company’s earnings of 88 cents per share missed the Zacks Consensus Estimate of 92 cents. The bottom line also dipped 4.35% on a year-over-year basis due to higher operating expenses.
Total operating revenue increased 6.93% year over year to $1,726 million but marginally fell short of the Zacks Consensus Estimate of $1,733.1 million. Excluding fuel surcharges, operating revenues increased 5% year over year. The top and the bottom line miss disappointed investors. Consequently, shares of the company declined in early trading.
Operating income in the second quarter decreased 6.8% to $164 million. Lower customer rates hurt results. But interest expenses increased on a year-over-year basis.
The effective income tax rate in the second quarter of 2017 is 37.4% compared with 38% a year-ago. The company expects a tax rate of 35% for full-year 2017. In addition, the company revised some aspects of its full-year 2017 guidance. For example, CAPEX for 2017 is now projected at $471 million (old guidance: $477 million).
Segmental Performance
The Intermodal division reported quarterly revenues of $1 billion, up 7% year over year. Overall volumes in the segment climbed 5%. Revenue per load, excluding fuel surcharge revenues, dipped 1%. Operating income increased 4% year over year to $110 million.
Dedicated Contract Services revenues increased 8% year over year to $412 million. The company added new trucks to the fleet and customer retention rates remained above 98%. Operating income decreased 4% year over year to $49 million, primarily due to increased costs like driver wages.
Capacity Solutions revenues surged 9% year over year to $222 million on the back of 20% increase in volumes. Revenue per load plunged 9% on a year-over-year basis. Operating income declined over 100% due to lower gross profit margin and higher costs.
Truck revenues decreased 4% to $95 million. At the end of the quarter, the company operated 2,072 tractors, down 5.7% year over year. Also, operating income decreased 37% to $5.6 million due to higher costs like higher driver pay.
Liquidity
At the end of the second quarter, cash and cash equivalents were $7.3 million compared with approximately $6.4 million at the end of 2016. Long-term debt was $943.2 million compared with $986.3 million at the end of 2016.
J.B. Hunt Transport Services, Inc. Price and EPS Surprise
Investors interested in the transportation sector are keenly awaiting for second-quarter earnings reports from key players like Kansas City Southern , Canadian National Railway Company (CNI - Free Report) and Norfolk Southern Corp. (NSC - Free Report) in the coming days. While Kansas City Southern is scheduled to report on Jul 21, Canadian National and Norfolk Southern are scheduled to report on Jul 25 and Jul 26, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
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J.B. Hunt (JBHT) Stock Falls on Q2 Earnings, Sales Miss
J.B. Hunt Transport Services Inc. (JBHT - Free Report) performed disappointingly in the second quarter of 2017, reporting lower-than-expected earnings as well as revenues.
This transportation company’s earnings of 88 cents per share missed the Zacks Consensus Estimate of 92 cents. The bottom line also dipped 4.35% on a year-over-year basis due to higher operating expenses.
Total operating revenue increased 6.93% year over year to $1,726 million but marginally fell short of the Zacks Consensus Estimate of $1,733.1 million. Excluding fuel surcharges, operating revenues increased 5% year over year. The top and the bottom line miss disappointed investors. Consequently, shares of the company declined in early trading.
During the quarter, this Zacks Rank #4 (Sell) company repurchased approximately 564,000 shares for $50 million. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Operating income in the second quarter decreased 6.8% to $164 million. Lower customer rates hurt results. But interest expenses increased on a year-over-year basis.
The effective income tax rate in the second quarter of 2017 is 37.4% compared with 38% a year-ago. The company expects a tax rate of 35% for full-year 2017. In addition, the company revised some aspects of its full-year 2017 guidance. For example, CAPEX for 2017 is now projected at $471 million (old guidance: $477 million).
Segmental Performance
The Intermodal division reported quarterly revenues of $1 billion, up 7% year over year. Overall volumes in the segment climbed 5%. Revenue per load, excluding fuel surcharge revenues, dipped 1%. Operating income increased 4% year over year to $110 million.
Dedicated Contract Services revenues increased 8% year over year to $412 million. The company added new trucks to the fleet and customer retention rates remained above 98%. Operating income decreased 4% year over year to $49 million, primarily due to increased costs like driver wages.
Capacity Solutions revenues surged 9% year over year to $222 million on the back of 20% increase in volumes. Revenue per load plunged 9% on a year-over-year basis. Operating income declined over 100% due to lower gross profit margin and higher costs.
Truck revenues decreased 4% to $95 million. At the end of the quarter, the company operated 2,072 tractors, down 5.7% year over year. Also, operating income decreased 37% to $5.6 million due to higher costs like higher driver pay.
Liquidity
At the end of the second quarter, cash and cash equivalents were $7.3 million compared with approximately $6.4 million at the end of 2016. Long-term debt was $943.2 million compared with $986.3 million at the end of 2016.
J.B. Hunt Transport Services, Inc. Price and EPS Surprise
J.B. Hunt Transport Services, Inc. Price and EPS Surprise | J.B. Hunt Transport Services, Inc. Quote
Upcoming Releases
Investors interested in the transportation sector are keenly awaiting for second-quarter earnings reports from key players like Kansas City Southern , Canadian National Railway Company (CNI - Free Report) and Norfolk Southern Corp. (NSC - Free Report) in the coming days. While Kansas City Southern is scheduled to report on Jul 21, Canadian National and Norfolk Southern are scheduled to report on Jul 25 and Jul 26, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation. See Them Free>>