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J.B. Hunt Slides on Third-Quarter Earnings Miss

Earnings miss estimates but third-quarter revenue rises 5% and beats Wall Street expectations.

J.B. Hunt Transport Services  (JBHT) - Get J.B. Hunt Transport Services, Inc. (JBHT) Report was falling Friday after the trucking company missed Wall Street's third-quarter earnings estimates.

Shares of the Lowell, Ark.-based company were off 6.2% to $133 in premarket trading.

J.B. Hunt reported net income of $125.5 million, or $1.18 a share, down from $118.4 million, or $1.10 a share, a year ago, and below FactSet's call for earnings of $1.30. 

Revenue totaled $2.47 billion, up 5% from a year ago, and ahead of analysts' consensus of $2.36 billion. 

Intermodal revenue was down 2% to $1.21 billion, matching analysts' expectations. Volumes were heavily constrained by rail congestion and service issues, the company said, which stemmed from a large and sudden increase in demand and intermittent labor challenges in both the rail and truck networks.

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Dedicated contract services revenue rose 1% to $553 million and topped expectations of $542.6 million. Productivity, defined as revenue per truck per week, was flat compared with 2019. 

Integrated capacity solutions revenue rose 28% to $431 million, beating analysts' expectations of $340.4 million

As of Sept. 30, company said it had a total of $1.30 billion outstanding on various debt instruments which is comparable to total debt levels a year ago. There were no stock purchases during the quarter.

Operating income decreased by $12.7 million from the third quarter 2019 primarily from lower gross profit margins.

Gross profit margins decreased to 7.6% in the current period compared with 12.7% in the same period last year primarily from a competitive contractual pricing environment and tight supply dynamics that occurred throughout the quarter