Is It Time to Sell J.B. Hunt?
Trucking and transportation company J.B. Hunt Transport Services (NASDAQ: JBHT) reported earnings Oct. 15. While quarterly profits increased 15.3% over the prior year, these results still fell well short of analyst forecasts. The net earnings were short of analyst expectations despite better-than-forecast revenues, due mostly to one-time non-cash expenses.
Importantly, the company's intermodal business stabilized quarter-over-quarter after turmoil earlier in the year. Nonetheless, some margin compression and increased personnel expenses are weighing on earnings.
J.B. Hunt has impressed investors with some shrewd acquisitions, and its entry to the logistics brokerage business, but the company's fortunes are still closely tied to macroeconomic trends. The company operates in a highly cyclical industry, and the Q1 2019 struggles in its largest business segment, intermodal, were caused by falling rail freight volumes, a factor over which J.B. Hunt has zero control.
Source Fool.com
