Justin Paget/DigitalVision via Getty Images J.B. Hunt is finding itself in a unique position as the macroeconomic data appears relatively mixed. On the one hand, June ISM-PMIs are flashing contractionary territory as business activity, new orders, backlogs, and inventories fall into sharp decline. I believe the silver lining here is that inventories have been drastically drawn down in an attempt to right-size businesses, and that replenishment will inevitably occur. Though this is a more optimistic outlook, ...

Core Insights - J.B. Hunt Transport Services Inc (NASDAQ:JBHT) stock is experiencing a decline of 7.2% to $163.31, breaking a five-day winning streak and remaining down 18.3% year-to-date [1][2] - The company's second-quarter results were disappointing, with profits falling 24% due to industry headwinds, prompting analysts to adjust their price targets [2] - J.P. Morgan Securities raised its price target for JBHT from $184 to $201, while Barclays reduced its target from $170 to $160 [2] Options Activity - There has been significant activity in the options market, with 2,614 calls and 4,079 puts exchanged, which is eight times the average daily options volume [3] - The most popular options contracts are the July 160 and 165 puts [3] - JBHT's stock is considered "oversold," indicated by a 14-day relative strength index (RSI) of 85.9, which may be influencing the negative price movement [3]

Core Insights - J.B. Hunt's quarterly earnings of $1.32 per share missed the Zacks Consensus Estimate of $1.51 and represented a 27% decline year over year [1] - Total operating revenues of $2.93 billion fell short of the Zacks Consensus Estimate of $3.03 billion, marking a 7% year-over-year decrease [12] - The company reported an operating loss of $13.3 million, an increase from the previous quarter's loss of $4.4 million, attributed to decreased gross profit and higher costs [5] Financial Performance - Operating income for the reported quarter decreased 24% year over year to $205.7 million due to lower revenues and increased expenses [2] - Net interest expenses grew 38% year over year, driven by higher effective interest rates and a consolidated debt balance [13] - Cash and cash equivalents at the end of the quarter were $53.50 million, down from $64.18 million in the prior quarter, while long-term debt increased to $1.48 billion from $1.36 billion [27] Segment Performance - The Dedicated Contract Services segment saw revenues decline 4% year over year to $851 million, impacted by a 1% drop in average trucks and a 3% decrease in productivity [4] - The Intermodal division generated revenues of $1.41 billion, down 5% year over year due to a 1% decrease in volume and a 5% decrease in gross revenue per load [14] - Integrated Capacity Solutions revenues decreased 21% year over year to $270 million, with segmental volumes down 25% [16] Market Reaction - Shares of J.B. Hunt declined 2.93% in after-market trading following the disappointing second-quarter results [11] - Year-to-date, J.B. Hunt's shares have decreased by 14.9%, compared to a 3.6% loss in the industry [20] Shareholder Actions - In the second quarter of 2024, J.B. Hunt repurchased approximately 1,225,000 shares for $203 million, with about $163 million remaining under its share repurchase authorization [19]

Financial Data and Key Metrics Changes - Revenue declined 7% year-over-year, operating income decreased 24%, and diluted earnings per share fell by 27% [27][28] - The tax rate for the quarter was slightly elevated at 26.8%, with expectations for the full year tax rate to be in the range of 24% to 25% [28] Business Line Data and Key Metrics Changes - Intermodal and Highway Services businesses experienced lower revenue primarily due to lower rates, with a noted decline in operating income [27] - Dedicated margins were softer, underperforming seasonality, despite selling a few hundred more trucks [9] - Final Mile business showed progress in its profit improvement plan, with stable demand for appliances and exercise equipment but continued softness in furniture demand [38] Market Data and Key Metrics Changes - Intermodal volumes were down 1% year-over-year, with a 7% decline in the east, partially offset by a 4% growth in the Transcon business [42] - The overall brokerage environment remains competitive, with ICS gross revenue declining 21% year-over-year, driven by a 25% decline in volume [48] Company Strategy and Development Direction - The company remains focused on delivering exceptional value through operational excellence, scaling long-term investments in people, technology, and capacity, and driving long-term value for shareholders [17][23] - The management team is committed to maintaining a long-term mindset while managing costs in the near term, with a disciplined approach to capital allocation [25][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging market conditions but expressed optimism about the potential for future growth, particularly in the Intermodal and Dedicated segments [24][46] - There is a recognition of the need for pricing improvements to enhance margins, with a focus on volume as a leading indicator [56][65] Other Important Information - The company has received multiple awards for high service levels from customers and continues to invest in safety and technology to enhance operational efficiency [24][39] - The acquisition of Intermodal assets from Walmart earlier this year is expected to increase long-term growth potential [25] Q&A Session Summary Question: Insights on volume pickup in June - Management noted that the volume increase was influenced by various factors, including early shipments for peak season and improved customer business [53] Question: Intermodal margin recovery - Management indicated that pricing improvements are essential for margin recovery, with volume being a leading indicator [61][65] Question: Expectations for revenue per load and margin - Management suggested that the full impact of the bid cycle would be reflected in the third quarter, with no significant step downs anticipated [67] Question: Market dynamics and share loss - Management acknowledged challenges in the market but highlighted strong performance in the Transcon marketplace and ongoing discussions with customers about value propositions [69] Question: Long-term growth outlook - Management emphasized the importance of long-term investments in people, technology, and capacity to prepare for future growth opportunities [71][75]

Core Insights - JB Hunt reported $2.93 billion in revenue for Q2 2024, a year-over-year decline of 6.5% and EPS of $1.32 compared to $1.81 a year ago [1] Revenue Performance - Intermodal revenue was $1.41 billion, matching the average estimate, but reflecting a year-over-year decline of 5.5% [3] - Revenue from Integrated Capacity Solutions was $270.38 million, below the average estimate of $301.96 million, representing a year-over-year decline of 21.3% [3] - Truckload revenue was $168.10 million, below the average estimate of $176.29 million, showing a year-over-year decline of 12.4% [3] - Dedicated revenue was $851.01 million, below the average estimate of $895.33 million, with a year-over-year decline of 4.1% [3] - Final Mile Services revenue was $235.29 million, slightly below the average estimate but showing a year-over-year increase of 5.1% [3] - Fuel surcharge revenues were $383.66 million, below the average estimate of $405.22 million, reflecting a year-over-year decline of 9.7% [3] - Operating revenues, excluding fuel surcharge revenues, were $2.55 billion, below the average estimate of $2.63 billion, representing a year-over-year decline of 6% [3] Earnings Performance - The reported revenue was a surprise of -3.53% compared to the Zacks Consensus Estimate of $3.04 billion, and the EPS surprise was -12.58% against the consensus estimate of $1.51 [4] Stock Performance - JB Hunt shares returned +7.4% over the past month, outperforming the Zacks S&P 500 composite's +3.8% change [5] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance in the near term [5]

Company Performance - JB Hunt reported quarterly earnings of $1.32 per share, missing the Zacks Consensus Estimate of $1.51 per share, and down from $1.81 per share a year ago [8] - The company posted revenues of $2.93 billion for the quarter ended June 2024, missing the Zacks Consensus Estimate by 3.53%, and down from $3.13 billion year-over-year [2] - JB Hunt has not surpassed consensus EPS estimates over the last four quarters [9] Stock Performance - JB Hunt shares have declined approximately 15.1% since the beginning of the year, contrasting with the S&P 500's gain of 18.1% [3] - The current consensus EPS estimate for the upcoming quarter is $1.73 on revenues of $3.19 billion, and for the current fiscal year, it is $6.43 on revenues of $12.54 billion [5] Industry Outlook - The Transportation - Truck industry, to which JB Hunt belongs, is currently ranked in the bottom 12% of over 250 Zacks industries, indicating a challenging environment [13] - The estimate revisions trend for JB Hunt is unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, suggesting expected underperformance in the near future [12]

This presentation and discussion may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "intends," "estimates," or similar expressions are intended to identify these forward-looking statements. These statements are based on J.B. Hunt's current plans and expectations and involve risks and uncertainties that could cause future activities and results of operations to be materially different from those set forth ...

[Q2 2024 Financial Highlights](index=1&type=section&id=J.B.%20HUNT%20TRANSPORT%20SERVICES,%20INC.%20REPORTS%20U.S.%20GAAP%20REVENUES,%20NET%20EARNINGS%20AND%20EARNINGS%20PER%20SHARE%20FOR%20THE%20SECOND%20QUARTER%202024) [Overall Performance](index=1&type=section&id=Overall%20Performance) J.B. Hunt experienced a challenging Q2 2024 with a **7%** revenue decline to **$2.93 billion** and a **24%** operating income drop to **$205.7 million**, driven by lower volumes and increased operating costs | Financial Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Total Operating Revenue** | $2.93 billion | $3.13 billion | -7% | | **Operating Income** | $205.7 million | $270.7 million | -24% | | **Net Earnings** | $135.9 million | $189.6 million | -28% | | **Diluted EPS** | $1.32 | $1.81 | -27% | - The **7% decrease** in total operating revenue was primarily caused by volume declines in Integrated Capacity Solutions (**-25%**), Truckload (**-9%**), and Dedicated Contract Services (**-9%**), along with a **5% decrease** in gross revenue per load in the Intermodal segment[6](index=6&type=chunk) - Operating income reduction was attributed to lower revenue combined with increased expenses in insurance and claims, equipment, and certain personnel-related areas[1](index=1&type=chunk) - Net interest expense rose approximately **38% YoY** due to higher effective interest rates and a larger consolidated debt balance[7](index=7&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Information) [Intermodal (JBI)](index=2&type=section&id=Intermodal%20(JBI)) The Intermodal segment saw revenue decline **5%** and operating income drop **31%**, primarily due to a **1%** volume decrease and a **5%** reduction in revenue per load amid a soft freight market | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | $1.41 billion | $1.49 billion | -5% | | **Operating Income** | $99.2 million | $142.9 million | -31% | - Overall intermodal volume decreased **1% YoY**, with transcontinental loads increasing **4%** while eastern network loads decreased **7%**[2](index=2&type=chunk) - Gross revenue per load decreased by **5%** (**4%** excluding fuel surcharge) due to changes in customer rates, fuel surcharge revenue, and freight mix[2](index=2&type=chunk) - Operating income decline was attributed to lower yields, underutilization of assets, and increased costs for wages, equipment maintenance, and insurance[8](index=8&type=chunk) [Dedicated Contract Services (DCS)](index=2&type=section&id=Dedicated%20Contract%20Services%20(DCS)) The DCS segment experienced a **4%** revenue decline and **15%** operating income drop, driven by a **1%** decrease in average trucks and **3%** lower productivity, alongside increased operating costs | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | $851 million | $888 million | -4% | | **Operating Income** | $96.4 million | $113.6 million | -15% | - Revenue decline was caused by a **1% drop** in average trucks and a **3% decrease** in productivity (revenue per truck per week)[17](index=17&type=chunk) - The fleet had **339 fewer** revenue-producing trucks compared to the prior-year period, with customer retention rates at approximately **88%**, reflecting fleet downsizing[17](index=17&type=chunk) [Integrated Capacity Solutions (ICS)](index=2&type=section&id=Integrated%20Capacity%20Solutions%20(ICS)) The ICS segment saw a **21%** revenue decline and a widened operating loss of **$13.3 million**, primarily due to a **25%** volume decrease, despite a **5%** increase in revenue per load | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | $270 million | $344 million | -21% | | **Operating Loss** | $(13.3) million | $(4.4) million | N/A | - Overall segment volume decreased **25% YoY**, while revenue per load increased **5%**[18](index=18&type=chunk) - Gross profit margin improved to **14.8%** from **13.0%** in Q2 2023, reflecting intentional yield management and better capacity procurement[3](index=3&type=chunk) - The carrier base decreased by **24% YoY**, largely due to changes in carrier qualification requirements to mitigate cargo theft[3](index=3&type=chunk) [Final Mile Services (FMS)](index=3&type=section&id=Final%20Mile%20Services%20(FMS)) The FMS segment demonstrated strong performance with revenue increasing **5%** to **$235 million** and operating income surging **33%** to **$19.8 million**, driven by new contracts and cost management | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | $235 million | $224 million | +5% | | **Operating Income** | $19.8 million | $14.8 million | +33% | - Revenue growth was driven by multiple new contracts implemented over the last year, partially offset by efforts to improve revenue quality and general market weakness[19](index=19&type=chunk) - Operating income included a **$1.1 million** net benefit from two offsetting claim settlements; excluding this, income still increased due to higher revenue and lower personnel and equipment costs[20](index=20&type=chunk) [Truckload (JBT)](index=3&type=section&id=Truckload%20(JBT)) The JBT segment's revenue declined **12%** to **$168 million** and operating income decreased **7%** to **$3.5 million**, primarily due to a **9%** load volume drop and **4%** lower revenue per load | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Segment Revenue** | $168 million | $192 million | -12% | | **Operating Income** | $3.5 million | $3.8 million | -7% | - Revenue excluding fuel surcharge decreased **13%**, driven by a **9% decline** in load volume and a **4% decline** in revenue per load excluding fuel[11](index=11&type=chunk) - The operating income decline was less severe than the revenue decline due to cost management initiatives, which improved the operating income as a percentage of gross revenue[12](index=12&type=chunk) [Financial Statements & Data](index=5&type=section&id=Financial%20Statements%20%26%20Data) [Condensed Consolidated Statements of Earnings](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Earnings) Q2 2024 total operating revenues were **$2.93 billion**, a **7%** decrease, with operating income falling to **$205.7 million** and net earnings to **$135.9 million**, or **$1.32** per diluted share Q2 Statement of Earnings (in thousands, except per share data) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | | :--- | :--- | :--- | | **Total operating revenues** | $2,928,685 | $3,132,623 | | **Operating income** | $205,709 | $270,712 | | **Net earnings** | $135,873 | $189,552 | | **Diluted earnings per share** | $1.32 | $1.81 | YTD Statement of Earnings (in thousands, except per share data) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | **Total operating revenues** | $5,872,685 | $6,362,212 | | **Operating income** | $400,078 | $548,201 | | **Net earnings** | $263,366 | $387,320 | | **Diluted earnings per share** | $2.54 | $3.70 | [Condensed Consolidated Balance Sheets](index=12&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2024, total assets were **$8.42 billion**, total liabilities **$4.34 billion**, and shareholders' equity **$4.08 billion**, with cash and equivalents at approximately **$54 million** Balance Sheet Highlights (in thousands) | Account | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total current assets** | $1,913,710 | $2,084,912 | | **Net property and equipment** | $5,833,493 | $5,773,913 | | **Total Assets** | $8,415,880 | $8,538,260 | | **Total current liabilities** | $1,581,460 | $1,779,421 | | **Long-term debt** | $1,483,804 | $1,326,107 | | **Shareholders' equity** | $4,075,996 | $4,103,758 | | **Total Liabilities & Equity** | $8,415,880 | $8,538,260 | [Cash Flow and Capitalization](index=3&type=section&id=Cash%20Flow%20and%20Capitalization) Net cash from operating activities for H1 2024 was **$827 million**, a decrease from **$1.1 billion**, with net capital expenditures significantly reduced to **$409 million** and total debt at **$1.48 billion** Six Months Ended June 30 (in thousands) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $827,021 | $1,097,290 | | **Net capital expenditures** | $408,853 | $853,778 | - Total debt outstanding was approximately **$1.48 billion** as of June 30, 2024, compared to **$1.45 billion** a year prior and **$1.58 billion** at the end of 2023[21](index=21&type=chunk) - Cash and cash equivalents were approximately **$54 million** at the end of the second quarter[13](index=13&type=chunk) [Operating Statistics by Segment](index=8&type=section&id=Operating%20Statistics%20by%20Segment) Q2 2024 operating statistics reflected a soft freight environment, with Intermodal loads down **1%**, Dedicated loads down **9%**, ICS loads down **25%**, Truckload loads down **9%**, and FMS stops down **4%** Q2 2024 vs Q2 2023 Key Operating Metrics | Segment | Metric | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | **Intermodal** | Loads | 497,446 | 501,681 | | **Dedicated** | Loads | 1,007,798 | 1,104,896 | | **ICS** | Loads | 145,362 | 194,635 | | **Final Mile** | Stops | 1,098,521 | 1,141,415 | | **Truckload** | Loads | 92,628 | 101,402 | [Shareholder Activity](index=3&type=section&id=Shareholder%20Activity) [Share Repurchase Program](index=3&type=section&id=Share%20Repurchase%20Program) In Q2 2024, the company repurchased approximately **1.225 million** shares for **$203 million**, with **$163 million** remaining under the share repurchase authorization - In Q2 2024, the company repurchased approximately **1,225,000 shares** of common stock at a cost of around **$203 million**[14](index=14&type=chunk) - At the end of the quarter (June 30, 2024), approximately **$163 million** was still available under the existing share repurchase authorization[14](index=14&type=chunk)

Loading... Loading... J.B. Hunt Transport Services, Inc. JBHT will release its second quarter financial results, after the closing bell on Tuesday, July 16. Analysts expect the Lowell, Arkansas-based company to report quarterly earnings at $1.53 per share, down from $1.81 per share in the year-ago period. J.B. Hunt Transport is expected to post revenue of $3.05 billion, compared to $3.13 billion a year earlier, according to data from Benzinga Pro. On April 16, J.B. Hunt Transport reported first-quarter 2024 ...

Core Viewpoint - J.B. Hunt Transport Services, Inc. is expected to report a decline in revenues for the second quarter of 2024, with various segments showing mixed performance and increased operating expenses impacting the bottom line [3][6][16]. Revenue Expectations - The Zacks Consensus Estimate for J.B. Hunt's second-quarter 2024 revenues is $3.09 billion, reflecting a 1.20% year-over-year decline [3]. - The Dedicated Contract Services segment is projected to generate revenues of $899.91 million, indicating a 1.4% growth from the previous year due to an increase in average trucks [4]. - Truckload revenues are estimated at $179.18 million, representing a 6.6% decline from the same quarter last year, attributed to decreased revenue per load and load volume [5]. - Intermodal revenues are expected to be $1.467 billion, showing a 1.4% decline year-over-year due to changes in freight mix and customer rates [13]. - Integrated Capacity Solutions revenues are estimated at $309.52 million, indicating a 9.9% decline from the previous year, impacted by lower rates and changes in customer freight mix [14]. - Final Mile Services revenues are projected at $238.03 million, reflecting a 6.3% increase from the previous year, supported by new contracts [15]. Earnings Expectations - The consensus estimate for J.B. Hunt's second-quarter 2024 earnings has been revised downward by 19.5% over the past 90 days to $1.52 per share, which is a 16.02% decline from the year-ago figures [16]. - The company has a history of disappointing earnings surprises, missing the Zacks Consensus Estimate in each of the last four quarters, with an average miss of 11.65% [12]. Financial Challenges - Higher net interest expenses are expected to negatively impact J.B. Hunt's bottom line due to rising interest rates [6]. - Increased operating expenses from high fuel costs, transportation costs, and employee-related expenses are also anticipated to affect profitability [6].