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An Analysis of J.B. Hunt Transport’s Stock Price Performance

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Market capitalization

J.B. Hunt Transport Services’ (JBHT) common stock trades on the NASDAQ stock market. As of March 1, 2016, the company’s market capitalization stood at $8.56 billion.

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Stock performance

Capacity has become a matter of concern in the US transportation and logistics industry. The depressed commodities market, lower US overall exports, and increased retail inventory marred the freight volumes in 2015 and is expected to continue in 2016. It especially hit the asset-based service providers in the trucking space. The US trucking industry is fragmented and is more prone to downsides in economic activities.

J.B. Hunt Transport delivered a negative return of 9.13% in the last year. Let’s compare JBHT’s returns with the peer group companies.

  • Werner Enterprises (WERN) fell by 17%
  • SAIA Inc. (SAIA) fell by 40%
  • XPO Logistics (XPO) fell by a solid 44%
  • Swift Transportation (SWFT) fell by 39%
  • Landstar System went down by 14%
  • Expeditors International of Washington (EXPD) fell by 5%
  • Old Dominion Freight Line (ODFL) fell by 14.0%

Dividend payment

J.B. Hunt Transport (JBHT) has aligned its dividend policy considering future growth, present operating cash flows, and market conditions. The company had paid dividends in the past. However, in early 2000, the company announced its decision to discontinue its policy of paying cash dividends. In 2000, JBHT paid a cash dividend of $0.03 per share. In April 2004, it again started paying quarterly cash dividends.

In fiscal 2015, JBHT paid a cash dividend of $0.84 per share, implying a dividend payout ratio of 23%. On January 28, 2016, the company announced a rise in quarterly cash dividend by ~5%, amounting to $0.22 per share. For investors’ information, the company paid a total dividend of $97.3 million in 2015.

Marten Transportation (MRTN), WERN, ArcBest Corporation (ARCB), KNX, Celadon Group (CGI), Heartland Express (HTLD), and LSTR are some of the dividend-paying trucking companies. A few of them are part of the First Trust Industrials and Producer Durables AlphaDEX ETF (FXR).

In the last topic of this J.B. Hunt Transport overview, we will find out why investors are ready to pay more for the company.

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