NEW YORK (TheStreet) -- J.B. Hunt Transport Services (JBHT) - Get J.B. Hunt Transport Services Inc. Report stock is down by 2.01% to $82.46 on Tuesday morning, as BMO Capital Markets downgraded the stock to "market perform" from "outperform."
The Lowell, AR-based holding company is engaged in providing surface transportation, delivery and logistics services.
There continues to be upside for long-term holders of Hunt stock, underpinned by double-digit earnings per share growth and strong financial returns, BMO noted.
However, the shares are up more than 30% since its January lows, which the firm attributes largely to an easing of recession-related fears as recent economic data has been somewhat better than expected.
"In our view, the strong share price performance over the last two months is likely to partially mute the upside to the stock in the near term as the multiple has risen close to its five-year average," BMO wrote in an analyst note.
Additionally, there is a long runway of highway-to-rail conversion opportunities and the firm expects domestic intermodal service will continue to gain share from long haul trucking.
However, the backdrop for GDP growth expectations in the 2% to 2.5% range and low fuel prices may limit the highway-to-rail conversion opportunities in shorter-haul lanes, BMO added.
The firm also raised its price target on the stock to $88 from $85.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B+ on Hunt.
This is driven by several positive factors, which should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks covered.
The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, good cash flow from operations and growth in earnings per share.
The team believes its strengths outweigh the fact that the company shows low profit margins.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: JBHT