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J. B. Hunt (JBHT) Hurt by Segmental Weakness, High Debt
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J.B. Hunt Transport Services, Inc.'s (JBHT - Free Report) first-quarter 2024 revenues of $2,944 million missed the Zacks Consensus Estimate of $3,117.1 million and fell 8.8% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 7% year over year. The downfall was owing to a 9% decrease in segment gross revenue per load in both Intermodal (JBI) and Truckload (JBT), 22% fewer loads in Integrated Capacity Solution (ICS), and a modest decline in average trucks and productivity in Dedicated Contract Services (DCS). Revenue declines in JBI, ICS, JBT and DCS were partially offset by Final Mile Services (FMS) revenue growth of 2%, primarily driven by new contracts implemented over the past year.
Higher net interest expense is likely to mar J.B. Hunt’s bottom line. Net interest expense for the first quarter of 2024 increased 6% year over year due to higher effective interest rates and consolidated debt balance, partially offset by higher interest income.
J.B. Hunt’s weak cash position is worrisome. JBHT's cash and cash equivalents were $64.18 million at the first quarter of 2024-end, much lower than the long-term debt of $1,366.51 million.
Partly due to these headwinds, shares of JBHT have lost 16.2% so far this year compared with its industry’s decline of 32.4%.
Image Source: Zacks Investment Research
On the flip side, we are impressed by the company’s efforts to reward its shareholders through dividend payments and share repurchases. In the first quarter of 2024, JBHT purchased almost 126,000 shares for $25 million. As of Mar 31, 2024, JBHT had approximately $366 million remaining under its share repurchase authorization.
Declining operating expenses due to lower fuel costs, purchased transportation costs, and salaries, wages and benefits expenses have the potential to boost J.B. Hunt's bottom line. During the first quarter of 2024, operating expenses fell 6.8% year over year.
Zacks Rank and Stocks to Consider
J.B. Hunt currently carries a Zacks Rank #5 (Strong Sell).
Air Lease has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 20.15%.
The Zacks Consensus Estimate for 2024 earnings has been revised 27.7% upward over the past 90 days. AL has an expected earnings growth rate of 29.96% for 2024. Shares of AL have gained 31.7% in the past year.
KEX has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 5.75%.
KEX has an expected earnings growth rate of 32.80% for 2024. Shares of KEX have gained 41.6% in the past year.
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J. B. Hunt (JBHT) Hurt by Segmental Weakness, High Debt
J.B. Hunt Transport Services, Inc.'s (JBHT - Free Report) first-quarter 2024 revenues of $2,944 million missed the Zacks Consensus Estimate of $3,117.1 million and fell 8.8% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 7% year over year. The downfall was owing to a 9% decrease in segment gross revenue per load in both Intermodal (JBI) and Truckload (JBT), 22% fewer loads in Integrated Capacity Solution (ICS), and a modest decline in average trucks and productivity in Dedicated Contract Services (DCS). Revenue declines in JBI, ICS, JBT and DCS were partially offset by Final Mile Services (FMS) revenue growth of 2%, primarily driven by new contracts implemented over the past year.
Higher net interest expense is likely to mar J.B. Hunt’s bottom line. Net interest expense for the first quarter of 2024 increased 6% year over year due to higher effective interest rates and consolidated debt balance, partially offset by higher interest income.
J.B. Hunt’s weak cash position is worrisome. JBHT's cash and cash equivalents were $64.18 million at the first quarter of 2024-end, much lower than the long-term debt of $1,366.51 million.
Partly due to these headwinds, shares of JBHT have lost 16.2% so far this year compared with its industry’s decline of 32.4%.
Image Source: Zacks Investment Research
On the flip side, we are impressed by the company’s efforts to reward its shareholders through dividend payments and share repurchases. In the first quarter of 2024, JBHT purchased almost 126,000 shares for $25 million. As of Mar 31, 2024, JBHT had approximately $366 million remaining under its share repurchase authorization.
Declining operating expenses due to lower fuel costs, purchased transportation costs, and salaries, wages and benefits expenses have the potential to boost J.B. Hunt's bottom line. During the first quarter of 2024, operating expenses fell 6.8% year over year.
Zacks Rank and Stocks to Consider
J.B. Hunt currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks from the Zacks Transportation sector are Air Lease Corporation (AL - Free Report) and Kirby Corporation (KEX - Free Report) . Each stock presently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Air Lease has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 20.15%.
The Zacks Consensus Estimate for 2024 earnings has been revised 27.7% upward over the past 90 days. AL has an expected earnings growth rate of 29.96% for 2024. Shares of AL have gained 31.7% in the past year.
KEX has an impressive earnings surprise history. The company's earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 5.75%.
KEX has an expected earnings growth rate of 32.80% for 2024. Shares of KEX have gained 41.6% in the past year.