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LOWELL, Ark. - J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) reported third quarter earnings that significantly exceeded analyst expectations, driving shares up 10.7% as investors responded positively to the company’s improved profitability despite flat revenue.
The transportation and logistics company posted earnings per share of $1.76, handily beating the analyst estimate of $1.46. Revenue came in at $3.05 billion, slightly above the consensus estimate of $3.02 billion but essentially flat compared to the $3.07 billion reported in the same quarter last year.
Operating income increased 8% to $242.7 million, reflecting the company’s successful efforts to reduce structural costs and improve productivity across its operations. The stock surge followed these better-than-expected results as investors appreciated the company’s ability to grow profits despite revenue challenges.
"I’m proud of our people for their hard work to deliver this improved financial performance," said Shelley Simpson, president and CEO. "I remain confident in our long-term strategy focused on operational excellence with our customers, safety performance, and execution on the efforts to lower our cost to serve to deliver value for all of our stakeholders."
The company’s Intermodal segment, its largest business unit, saw a 12% increase in operating income despite a 2% decline in revenue. Dedicated Contract Services posted a 9% increase in operating income on a 2% revenue increase, while Integrated Capacity Solutions narrowed its operating loss to $0.8 million from $3.3 million a year earlier.
J.B. Hunt’s improved profitability came from multiple initiatives, including network efficiency improvements, lower purchase transportation costs, and productivity gains. These positive factors helped offset challenges from higher professional-driver wages and increased equipment-related costs.
During the quarter, the company repurchased approximately 1.6 million shares for about $230 million, with approximately $107 million remaining under its current share repurchase authorization.
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