J.B. Hunt Transport Services, Inc. Just Missed Earnings - But Analysts Have Updated Their Models

As you might know, J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) last week released its latest second-quarter, and things did not turn out so great for shareholders. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$2.9b, statutory earnings missed forecasts by 12%, coming in at just US$1.32 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for J.B. Hunt Transport Services

Following last week's earnings report, J.B. Hunt Transport Services' 17 analysts are forecasting 2024 revenues to be US$12.1b, approximately in line with the last 12 months. Statutory earnings per share are forecast to dip 4.6% to US$5.65 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$12.5b and earnings per share (EPS) of US$6.33 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the US$183 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic J.B. Hunt Transport Services analyst has a price target of US$211 per share, while the most pessimistic values it at US$145. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await J.B. Hunt Transport Services shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 3.7% by the end of 2024. This indicates a significant reduction from annual growth of 9.8% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - J.B. Hunt Transport Services is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for J.B. Hunt Transport Services. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$183, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple J.B. Hunt Transport Services analysts - going out to 2026, and you can see them free on our platform here.

You can also view our analysis of J.B. Hunt Transport Services' balance sheet, and whether we think J.B. Hunt Transport Services is carrying too much debt, for free on our platform here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com