J.B. Hunt stock holds steady as Benchmark reiterates Buy rating

Published 16/07/2025, 15:54
J.B. Hunt stock holds steady as Benchmark reiterates Buy rating

Investing.com - Benchmark has reiterated its Buy rating and $165.00 price target on J.B. Hunt Transport Services (NASDAQ:JBHT) following the company’s second-quarter earnings report. According to InvestingPro analysis, the company appears undervalued at current levels, with 14 analysts recently revising their earnings expectations downward for the upcoming period.

J.B. Hunt reported second-quarter earnings per share of $1.31, meeting Benchmark’s estimate and slightly exceeding the FactSet consensus of $1.30. The company posted total revenue of $2.928 billion, flat year-over-year but higher than Benchmark’s projection of $2.891 billion, driven by better-than-expected performance in its Intermodal and Truckload segments. The company maintains a solid financial position with moderate debt levels and an Altman Z-Score of 5.12, indicating strong financial health.

Operating income came in at $197.3 million, down 4% year-over-year but above Benchmark’s estimate of $192.5 million. The company’s operating margin was 6.7%, one of the lowest levels in over a decade but an improvement from the first quarter, with the earnings beat primarily coming from stronger results in the Dedicated business segment.

The Intermodal segment showed positive volume growth of 6% year-over-year, exceeding expectations with sequential improvement from the first quarter. Revenue per load excluding fuel in this segment decreased 3.2% year-over-year but performed slightly better than anticipated, while margins aligned with Benchmark’s 6.7% estimate.

The Integrated Capacity Solutions (ICS) segment’s profitability, though still negative, continued to improve compared to last year and is expected to strengthen in 2025 as $35 million in costs related to the BNSF acquisition in 2024 will not recur. InvestingPro data reveals the company has maintained dividend payments for 22 consecutive years and has been raising dividends for 11 straight years, demonstrating strong commitment to shareholder returns. Get access to more exclusive insights and detailed analysis with the comprehensive Pro Research Report, available on InvestingPro.

In other recent news, J.B. Hunt Transport Services reported second-quarter 2025 earnings that met analyst expectations, with earnings per share (EPS) at $1.31 and revenue slightly exceeding forecasts at $2.93 billion. Despite these results, the company experienced a decline in operating income by 4% due to inflationary pressures, which affected wages, insurance, and equipment costs. Stifel has lowered its price target for J.B. Hunt to $145 from $150, while maintaining a Hold rating, citing mixed results and ongoing challenges in several business segments. The company has been focusing on productivity and cost initiatives to counteract these pressures, generating over $225 million in free cash flow. Analysts from Stifel noted interest in the stock if it reaches the $130s price range. J.B. Hunt’s intermodal load volumes showed growth, but revenue per load remained under pressure, reflecting broader market challenges. The company anticipates net capital expenditures between $550 and $650 million for 2025, focusing on modest fleet growth in the Dedicated segment and preparing for a potential peak season with early surcharge programs.

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