J. B. Hunt Hurt by Segmental Weakness, Higher Interest Expenses

Core Viewpoint - J.B. Hunt Transport Services, Inc. (JBHT) is currently facing multiple challenges that make it an unattractive investment option [1] Financial Performance - J.B. Hunt's fourth-quarter 2024 operating revenues were $3.15 billion, exceeding the Zacks Consensus Estimate of $3.13 billion but reflecting a 4.8% year-over-year decline [2] - Total operating revenues, excluding fuel surcharge revenue, decreased by 2% year-over-year, driven by a 3% decline in intermodal revenue per load and a 2% decline in Truckload revenue per load [2] - The average trucks in Dedicated Contract Services saw a 4% decline, while load volume in Integrated Capacity Solutions dropped by 22% [2] Cost and Debt Issues - J.B. Hunt's net interest expense for 2024 increased by 23.9% year-over-year due to higher effective interest rates and a consolidated debt balance, despite some offset from higher interest income [3] - The company's cash and cash equivalents were reported at $46.98 million at the end of Q4 2024, significantly lower than its short-term debt of $500 million, indicating insufficient cash to meet debt obligations [4] Market Performance - J.B. Hunt's shares have decreased by 22% over the past year, while the transportation-truck industry has seen a decline of 35.7% [5] - The Zacks Consensus Estimate for current-quarter earnings has been revised downward by 23.1% in the past 60 days, with a 14.5% downward revision for the current year [8] Earnings and Ranking - J.B. Hunt currently holds a Zacks Rank of 4 (Sell) and has a Value Score of C, indicating its unattractiveness [9] - The company has a poor earnings surprise history, missing the Zacks Consensus Estimate in three of the last four quarters, with an average miss of 8.37% [9]