J.B. Hunt stock rating downgraded to Neutral by UBS on freight concerns

Investing.com - UBS downgraded J.B. Hunt Transport Services (NASDAQ:JBHT) from Buy to Neutral on Friday, while slightly raising its price target to $157.00 from $155.00. According to InvestingPro analysis, JBHT currently trades at a P/E ratio of 26.05, with analyst targets ranging from $133 to $180.

The downgrade comes as UBS expressed concerns about the soft freight market environment, noting that it does not anticipate sufficient tightening in 2026 to support mid-single digit contract pricing increases for the transportation company. Despite these challenges, JBHT has maintained dividend payments for 22 consecutive years and operates with a moderate level of debt.

UBS acknowledged J.B. Hunt’s strong positioning in its intermodal business, which it expects the company to leverage for continued growth, along with its dedicated segment serving as a significant growth driver beyond 2026.

Despite these strengths, the investment bank emphasized that J.B. Hunt is not immune to the current challenging freight backdrop, citing limited visibility for improvement in freight conditions in 2026.

UBS indicated that when freight market conditions eventually improve and capacity tightens, J.B. Hunt is expected to demonstrate operating leverage and earnings per share growth across its intermodal, truckload, and brokerage businesses.

In other recent news, J.B. Hunt Transport Services reported second-quarter earnings per share of $1.31, aligning with Benchmark’s estimate and slightly surpassing the FactSet consensus of $1.30. The company’s core operations performed slightly above analyst expectations, although this was offset by higher interest and tax expenses. In addition, J.B. Hunt has declared a regular quarterly dividend of $0.44 per share, payable on August 22, 2025, to stockholders of record as of August 8, 2025.

In corporate leadership developments, Brad Delco has been appointed as the new Chief Financial Officer, effective September 1. Analyst firms have also weighed in on J.B. Hunt’s stock, with Benchmark maintaining a Buy rating and a $165 price target, while TD Cowen reiterated a Hold rating with a $140 price target. BMO Capital maintained its Outperform rating, citing a $100 million cost savings plan that is expected to reduce risk in future earnings. These recent developments highlight J.B. Hunt’s ongoing financial strategies and market evaluations.

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