J.B. Hunt Transports gains after mixed earnings report

J.B. Hunt Transport Services (NASDAQ:JBHT) traded higher in early trading on Friday after the trucking company posted a better-than-feared Q4 earnings report.

Revenue fell 9.6% year-over-year during the quarter to $3.3B. Current quarter total operating revenue, excluding fuel surcharge revenue, decreased approximately 6% compared to a year ago. The decrease was primarily driven by a 12% and 7% decline in volume in Integrated Capacity Solutions and Truckload respectively, a 10% and 13% decline in revenue per load excluding fuel surcharge revenue in Intermodal and JBT, respectively, and a 12% decline in stops in Final Mile Services.

Intermodal volume increased 6% Y/Y. Transcontinental network loads increased 13%, while eastern network loads decreased 2%. Intermodal revenue of $1.62B was ahead of the consensus estimate for $1.57B. Meanwhile, truckload revenue decreased 19% during the quarter.

On a consolidated basis, operating income as a percentage of consolidated gross revenue decreased from a year ago as a result of higher equipment-related cost and professional driver and non-driver wages and benefits as a percentage of gross revenue. Those items were partially offset by lower rail and truck purchased transportation costs as a percentage of gross revenue.

Weighing in on the report, Morgan Stanley said the firm will need more quarters of evidence to definitively conclude that volume is on a structural upswing, instead of just coming off a very low base at a weird point of the cycle. "We are also not sure that pricing is not getting worse and mgmt. understandably declined to commit on pricing trends for 2024," warned analyst Ravi Shanker.

Shares of J.B. Hunt Transport Services (JBHT) were up 3.75% in premarket trading on Friday to $204.30.