Mixed Bag for J.B. Hunt: Q4 Earnings Lag Estimates, Revenues Surpass

Earnings Performance - J B Hunt Transport Services reported Q4 2024 EPS of $1 53, missing the Zacks Consensus Estimate of $1 62, leading to a double-digit stock decline in aftermarket trading [1] - The bottom line increased 4 1% year-over-year [1] - Total operating revenues of $3 15 billion narrowly beat the Zacks Consensus Estimate of $3 13 billion but declined 4 8% year-over-year due to lower fuel surcharge revenues and yield pressure in the Intermodal segment [2] - Total operating income increased 2% year-over-year to $207 million [2] Segment Performance Intermodal Division - Generated quarterly revenues of $1 6 billion, down 2% year-over-year, slightly above the estimate of $1 57 billion [3] - Intermodal volume increased 5% year-over-year, with transcontinental network loads up 4% and eastern network loads up 6% [3] - Operating income decreased 10% year-over-year due to lower yields [3] Dedicated Contract Services - Revenues fell 5% year-over-year to $839 million, below the estimate of $850 5 million, driven by a 4% decline in average trucks and a 1% reduction in productivity [4] - Productivity, excluding fuel surcharge revenues, increased 2% year-over-year due to contracted indexed-based price escalators [4] - Segmental operating income increased 5% year-over-year [4] Integrated Capacity Solutions - Revenues decreased 15% year-over-year to $308 million, slightly above the estimate of $305 5 million [5] - Segmental volumes decreased 22% year-over-year, while revenue per load increased 9% year-over-year due to higher contractual and transactional rates and changes in customer freight mix [5] - Segmental operating loss was $21 8 million, an improvement from the $24 9 million loss in Q4 2023 [6] - ICS carrier base decreased 10% year-over-year due to changes in carrier qualification requirements [6] Truckload - Revenues fell 7% year-over-year to $182 million, below the estimate of $195 3 million [6] - Excluding fuel surcharge revenues, segmental revenues fell 3% due to flat load volume and a 2% decline in gross revenue per load [6] - Segmental operating income increased to $8 6 million from a modest operating loss in Q4 2023 [7] Final Mile Services - Revenues fell 6% year-over-year to $228 million, below the estimate of $240 3 million, due to weak demand across end markets [8] - Operating income increased 7% year-over-year despite higher purchased transportation and insurance-related costs [8] Liquidity and Share Buybacks - J B Hunt ended 2024 with cash and cash equivalents of $47 million, down from $53 3 million at the end of 2023 [9] - Long-term debt decreased to $977 7 million from $1 33 billion at the end of 2023 [9] - In Q4 2024, the company repurchased approximately 489,000 shares for $86 million, with $882 million remaining under its share repurchase authorization as of Dec 31, 2024 [9] Zacks Rank and Peer Comparison - J B Hunt currently carries a Zacks Rank 4 (Sell) [11] - Investors may consider Alaska Air Group (ALK), which sports a Zacks Rank 1 (Strong Buy) and has delivered an average earnings beat of 23 2% over the past four quarters, with shares surging 99% in the past year [12] - C H Robinson Worldwide (CHRW) carries a Zacks Rank 2 (Buy), with a 1 3% upward revision in the Zacks Consensus Estimate for 2025 earnings and an average earnings beat of 10 3% over the past four quarters, with shares rising 21% in the past year [13]