J.B. Hunt: Analysts Have a Divided View


Dec. 4 2020, Updated 10:53 a.m. ET

Analysts’ recommendations

J.B. Hunt Transport Services (JBHT) has a consensus rating of 2.25, which indicates a “buy.” Among the 24 analysts polled by Thomson Reuters, there weren’t any changes in analysts’ opinion towards J.B. Hunt after its second-quarter results. Seven (29.2%) of the analysts recommend a “strong buy,” five (20.8%) recommend a “buy,” 11 (45.8%) recommend a “hold,” and one (4.2%) recommends a “sell.”

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Target prices

J.B. Hunt has a consensus 12-month target price of $133.80 per share, which implies a return potential of 10.1% over the next 52 weeks. J.B. Hunt stock returned 32% to shareholders in the last 12 months. We’ll compare J.B. Hunt’s return potential with its peers:

  • Schneider National (SNDR): $31.73 with a return potential of 20.5%
  • Werner Enterprises (WERN): $41.87 with a return potential of 14.4%
  • Old Dominion Freight Line (ODFL): $150.23 with a return potential of 3%

Why are the views mixed?

From analysts’ recommendations, we can conclude that they’re fairly divided on their recommendations for J.B. Hunt. While the company was able to improve its second-quarter revenues remarkably, it fell short on expanding its operating margins. J.B. Hunt hasn’t been able to efficiently handle the volume surge in the second quarter, which reflects a poor asset turnover ratio.

Despite a positive freight environment and a double-digit revenue rise, J.B. Hunt didn’t increase its 2018 guidance. The move baffled Wall Street analysts. Analysts think that there’s more room for higher shipments in the coming quarters.

Intermodal is J.B. Hunt’s major segment. In the current higher crude oil price era, trucking (IYT) companies are expected to face stiff competition from railroads that compete with the Intermodal segment. With railroads’ higher fuel efficiency, trucking companies operating across North America could lose business.


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