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J.B. Hunt (JBHT) Up 5.8% Since Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for J.B. Hunt Transport Services, Inc. (JBHT - Free Report) . Shares have added about 5.8% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
J.B. Hunt Stock Falls on Q2 Earnings, Sales Miss
J.B. Hunt's earnings of of $0.88 per share missed the Zacks Consensus Estimate of $0.92. The bottom line also dipped 4.35% on a year-over-year basis. 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.
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.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There have been two revisions higher for the current quarter compared to four lower. While looking back an additional 30 days, we can see even more upward momentum.
J.B. Hunt Transport Services, Inc. Price and Consensus
At this time, J.B. Hunt's stock has a nice Growth Score of B, though it is lagging a lot on the momentum front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Zacks' style scores indicate that the company's stock is suitable for value and growth investors.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Notably, the stock has a Zacks Rank #3 (Hold). We are looking for an inline return from the stock in the next few months.
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J.B. Hunt (JBHT) Up 5.8% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for J.B. Hunt Transport Services, Inc. (JBHT - Free Report) . Shares have added about 5.8% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
J.B. Hunt Stock Falls on Q2 Earnings, Sales Miss
J.B. Hunt's earnings of of $0.88 per share missed the Zacks Consensus Estimate of $0.92. The bottom line also dipped 4.35% on a year-over-year basis. 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.
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.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There have been two revisions higher for the current quarter compared to four lower. While looking back an additional 30 days, we can see even more upward momentum.
J.B. Hunt Transport Services, Inc. Price and Consensus
J.B. Hunt Transport Services, Inc. Price and Consensus | J.B. Hunt Transport Services, Inc. Quote
VGM Scores
At this time, J.B. Hunt's stock has a nice Growth Score of B, though it is lagging a lot on the momentum front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Zacks' style scores indicate that the company's stock is suitable for value and growth investors.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Notably, the stock has a Zacks Rank #3 (Hold). We are looking for an inline return from the stock in the next few months.