Benchmark maintains JBHT stock with $175 target post-earnings

On Wednesday, Benchmark analysts reiterated their Buy rating on J.B. Hunt Transport Services (NASDAQ:JBHT) with a price target of $175.00, following the company’s first-quarter earnings report. The $12.4 billion transportation and logistics company, currently trading at $124.02, reported earnings per share (EPS) of $1.17, aligning with FactSet consensus and slightly exceeding Benchmark’s expectation of $1.15. According to InvestingPro data, the stock is trading near its 52-week low, having declined over 20% year-to-date.

J.B. Hunt’s results matched the guidance provided in the fourth-quarter call, which anticipated a normal sequential earnings decline of 20-25%. The company’s intermodal load growth showcased a record increase, rising 7.6% year-over-year, and meeting internal projections. Despite the growth in volume, the firm noted only modest success in boosting intermodal rates per load. J.B. Hunt demonstrated a readiness to reject certain bids that did not match the quality of service provided by the company. With annual revenue of $12.1 billion and a healthy gross profit margin of 18.8%, the company maintains a strong market position. InvestingPro subscribers can access 8 additional key insights about JBHT’s financial health and market position.

The report also highlighted strong volume growth in the Eastern region, which could potentially lower revenue per load due to the mix of services offered. However, margins might remain stable, benefiting from the filling of empty lanes. The intermodal revenue and operating margins surpassed Benchmark’s estimates. Although intermodal revenue per load excluding fuel was down 2% year-over-year, it was better than expected.

J.B. Hunt did not receive significant customer feedback regarding a pull-forward of demand, but there was some noted out of Mexico. The freight market’s future remains uncertain, but Benchmark analysts believe that J.B. Hunt’s diversified business model, along with secular growth drivers in Intermodal and Dedicated services, and the company’s ability to leverage past investments, could support EPS growth in the long term. Nevertheless, they also acknowledged that patience might be wearing thin as intermodal price increases are sluggish, and mid-cycle earnings growth could be delayed. Despite these challenges, InvestingPro’s Fair Value analysis suggests the stock is currently undervalued. The company has maintained dividend payments for 22 consecutive years and operates with a moderate level of debt, demonstrating financial stability. For detailed analysis and comprehensive valuation metrics, investors can access JBHT’s Pro Research Report, part of InvestingPro’s coverage of over 1,400 US stocks.

Benchmark will provide more details following a review of their estimates.

In other recent news, J.B. Hunt Transport Services reported its first-quarter 2025 earnings, posting an earnings per share (EPS) of $1.17, which matched the consensus forecast. The company’s revenue slightly exceeded expectations at $2.92 billion, surpassing the anticipated $2.91 billion. Despite these figures, J.B. Hunt experienced a decline in operating income by 8% due to inflationary pressures. In analyst updates, Evercore ISI adjusted J.B. Hunt’s stock price target to $165 while maintaining an Outperform rating, noting a gradual EPS recovery amidst market uncertainties. Meanwhile, Stifel reduced its price target for J.B. Hunt shares from $158 to $150, maintaining a Hold rating, citing ongoing challenges in the freight environment.

J.B. Hunt’s intermodal volumes reached a record high with an 8% year-over-year increase, highlighting strong growth in its Eastern network and Mexico business. However, the company faced challenges with a contraction in its Dedicated fleet and ongoing losses in its Integrated Capacity Solutions segment. The company has revised its capital expenditure guidance down to $500-700 million, reflecting a cautious approach amid uncertain market conditions. J.B. Hunt remains focused on margin repair and cost management, with plans to return to net fleet growth in 2025.

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