J.B. Hunt issues $750M in senior notes due 2030

J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT), a prominent player in the trucking industry with a market capitalization of $15 billion, has entered into an agreement to issue $750 million in senior notes with a 4.900% interest rate, maturing on March 15, 2030. This move, announced on Monday, is part of the company’s strategic financial planning. According to InvestingPro analysis, the company is currently trading near its 52-week low, suggesting potential value opportunity for investors looking at this latest financial maneuver.

The underwriting agreement, dated March 11, 2025, was made with Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, acting as representatives of several underwriters. The offering and sale of the notes were registered under the Securities Act of 1933, as per a shelf registration statement.

Today, J.B. Hunt finalized a second supplemental indenture to the original indenture from March 1, 2019, with Computershare Trust Company, N.A., serving as Trustee. This indenture establishes the issuance of the notes, which will be unsecured obligations of the company and will rank equally with all existing and future senior debt of J.B. Hunt.

The notes, guaranteed by J.B. Hunt’s wholly-owned subsidiary J.B. Hunt Transport, Inc., and potentially by other subsidiaries in the future, will pay interest semiannually. The company may redeem the notes at any time before February 15, 2030, at a specified redemption price, or after that date at 100% of the principal amount plus accrued interest.

The indenture includes terms that may limit J.B. Hunt’s ability to incur additional secured debt, engage in certain sale and leaseback transactions, and merge or consolidate with, or transfer all or substantially all of its assets to, another entity. It also outlines customary events of default.

The legal opinion of Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C. regarding the legality of the notes issuance is incorporated into this report. This financial maneuver is part of J.B. Hunt’s broader strategy to manage its capital structure and invest in its business operations.

This report is based on a press release statement and provides a concise overview of J.B. Hunt’s financial actions as they expand their financial capabilities and continue to grow in the competitive transportation sector. For investors seeking deeper insights, InvestingPro offers comprehensive analysis through its Pro Research Report, one of 1,400+ detailed company analyses available to subscribers, including additional financial health metrics and growth indicators that help evaluate investment opportunities in the transportation sector.

In other recent news, J.B. Hunt Transport Services has introduced a new performance-based bonus program for its executive officers, focusing on operating income, revenue excluding fuel surcharges, and safety performance. This plan allows for substantial bonuses, contingent upon meeting specific performance metrics. Additionally, the company has announced an increase in its quarterly dividend to $0.44 per share, reflecting a 2.3% rise from the previous payout. This decision underscores J.B. Hunt’s commitment to returning value to shareholders.

Benchmark analysts have reiterated a Buy rating on J.B. Hunt, despite lowering earnings estimates following the company’s fourth-quarter earnings report. The report revealed an earnings per share of $1.53, falling short of estimates, but adjusted figures excluding an impairment charge showed better-than-expected results. On the other hand, TD Cowen maintained a Hold rating while reducing the price target from $180 to $171 due to the company’s performance and cautious outlook for growth in 2025.

In a separate development, director James L. Robo made a significant purchase of $9.99 million worth of J.B. Hunt stock, which could signal confidence in the company’s future prospects. This insider transaction is closely watched by investors as it may indicate positive expectations from those with intimate knowledge of the company. These developments are part of a series of recent events that investors are monitoring closely.

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