J.B. Hunt Transport Services, Inc. (JBHT) shares are riding high in pre-market trading after the company announced its third-quarter earnings results, exceeding analysts’ expectations despite a slight dip in revenue. The company’s operating revenue for the quarter came in at $3.07 billion, narrowly beating the consensus estimate of $3.02 billion. However, the revenue figure represents a 3% year-over-year decline, primarily attributed to a 5% drop in gross revenue per load in the Intermodal (JBI) segment and a 6% decrease in the Truckload (JBT) segment.
Further contributing to the revenue dip were load volume decreases of 10% in Integrated Capacity Solutions (ICS) and 6% in Dedicated Contract Services (DCS). Final Mile Services (FMS) also saw a 6% reduction in stops. Despite the revenue headwinds, the company managed to achieve total operating revenue, excluding fuel surcharge revenue, that decreased by less than 1% year-over-year in the quarter.
While revenue declined across most segments, J.B. Hunt’s operating income fell by a more moderate 7% year-over-year to $224.1 million. This decline was attributed to the decreased revenue across segments, excluding JBI, coupled with increased expenses related to personnel, insurance, claims, and equipment. However, the company’s earnings per share (EPS) of $1.49 exceeded the consensus estimate of $1.47, signaling a strong performance in managing costs and generating profits.
As of September 30, J.B. Hunt held approximately $120 million in cash and cash equivalents. During the third quarter, the company repurchased shares worth around $200 million, and as of the end of September, it had $967 million remaining under its share repurchase authorization. These share repurchases have undoubtedly played a role in boosting earnings per share and positively impacting investor sentiment.
Investors seeking exposure to J.B. Hunt can do so through exchange-traded funds (ETFs) such as the IShares Trust IShares U.S. Transportation ETF (IYT) and the ETF Opportunities Trust Tuttle Capital Shareholders First Index ETF (ESGX). The strong earnings performance and continued share repurchases have fueled optimism among investors, driving JBHT shares up 7.12% to $187.09 in pre-market trading on Wednesday. This upward trajectory suggests a positive outlook for the company’s future performance.
