J.B. Hunt Transport Services, Inc. JBHT announced that it will acquire the brokerage operations of an affiliate of Texas-based rail company BNSF Railway Co. The financial terms of the deal were not disclosed.
J.B. Hunt will pay cash to acquire the assets of BNSF Logistics LLC, which provides third-party logistics services (3PL), including truckload, flatbed, temperature-controlled, drayage, expedited and less-than-truckload. The deal, aimed at improving intermodal service, is expected to be completed by the end of 2023.
Per John Roberts, CEO of J.B. Hunt, “This acquisition is another step forward in our mission to create the most efficient transportation network in North America”.
J.B. Hunt has been a customer of BNSF Railway’s truck-rail intermodal services for several years, providing containers and truck trailers that move on BNSF’s rail network. The companies stepped up their commercial relationship last year.
BNSF Logistics provides value-added 3PL services for BNSF Railway. Upon closing the transaction, BNSF Railway and J.B. Hunt will enter into a long-term service agreement whereby J.B. Hunt will continue to provide services for BNSF Railway. Post-closure, the brokerage operations of BNSF Logistics will operate under J.B. Hunt’s Integrated Capacity Solutions segment.
Per Katie Farmer, president and CEO of BNSF Railway “This agreement with J.B. Hunt reflects our companies’ shared commitment to provide industry-leading intermodal service to our customers.”
J.B. Hunt currently carries Zacks Rank #4 (Sell).
Some better-ranked stocks for investors interested in the Zacks Transportation sector are GATX Corporation GATX and Triton International Limited TRTN.
GATX, which presently carries a Zacks Rank #2 (Buy), has strengthened its railcar leasing operations. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
For third-quarter and full-year 2023, GATX’s earnings are expected to register 36.6% and 14.3% growth, respectively, on a year-over-year basis.
Triton, which currently carries a Zacks Rank #2, is benefiting from its consistent efforts to reward shareholders through dividends and share repurchases.
Triton has an impressive liquidity position. Its current ratio (a measure of liquidity) was 3.83 at the end of second-quarter 2023. A current ratio of more than 1 often indicates that the company will be easily paying off its short-term obligations.
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