Shares of J.B. Hunt Transport Services (
JBHT Quick Quote JBHT - Free Report) have been strong performers lately, with the stock up 10.6% over the past month. The stock hit a new 52-week high of $206.84 in the previous session. J.B. Hunt Transport Services has gained 50.6% since the start of the year compared to the 10.8% move for the Zacks Transportation sector and the 64.3% return for the Zacks Transportation - Truck industry. What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on October 15, 2021, JB Hunt reported EPS of $1.88 versus consensus estimate of $1.77 while it beat the consensus revenue estimate by 4.75%.
For the current fiscal year, JB Hunt is expected to post earnings of $6.85 per share on $11.98 billion in revenues. This represents a 44.51% change in EPS on a 24.29% change in revenues. For the next fiscal year, the company is expected to earn $8.06 per share on $13.19 billion in revenues. This represents a year-over-year change of 17.54% and 10.13%, respectively.
JB Hunt may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
JB Hunt has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 30X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 21X versus its peer group's average of 10.6X. Additionally, the stock has a PEG ratio of 2. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, JB Hunt currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if JB Hunt meets the list of requirements. Thus, it seems as though JB Hunt shares could have potential in the weeks and months to come.
How Does JB Hunt Stack Up to the Competition?
Shares of JB Hunt have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also looking good, including Covenant Logistics Group (
CVLG Quick Quote CVLG - Free Report) , Forward Air ( FWRD Quick Quote FWRD - Free Report) , and ArcBest ( ARCB Quick Quote ARCB - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 11% of all the industries we have in our universe, so it looks like there are some nice tailwinds for JB Hunt, even beyond its own solid fundamental situation.