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J.B. Hunt Transport Services, Inc. Just Reported Annual Earnings: Have Analysts Changed Their Mind On The Stock?

Simply Wall St

Last week, you might have seen that J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) released its yearly result to the market. The early response was not positive, with shares down 3.2% to US$115 in the past week. Revenues of US$9.2b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$4.75, missing estimates by 3.1%. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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

NasdaqGS:JBHT Past and Future Earnings, January 21st 2020
NasdaqGS:JBHT Past and Future Earnings, January 21st 2020

Taking into account the latest results, the current consensus from J.B. Hunt Transport Services's 16 analysts is for revenues of US$9.80b in 2020, which would reflect a credible 6.9% increase on its sales over the past 12 months. Statutory earnings per share are expected to step up 18% to US$5.59. Yet prior to the latest earnings, analysts had been forecasting revenues of US$9.76b and earnings per share (EPS) of US$5.90 in 2020. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$116, with analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. The most optimistic J.B. Hunt Transport Services analyst has a price target of US$133 per share, while the most pessimistic values it at US$86.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

It can also be useful to step back and take a broader view of how analyst forecasts compare to J.B. Hunt Transport Services's performance in recent years. We would highlight that J.B. Hunt Transport Services's revenue growth is expected to slow, with forecast 6.9% increase next year well below the historical 9.4%p.a. growth over the last five years. Juxtapose this against the other companies in the market with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.3% next year. Factoring in the forecast slowdown in growth, it looks like analysts are expecting J.B. Hunt Transport Services to grow at about the same rate as the wider market.

The Bottom Line

The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for J.B. Hunt Transport Services. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider market. The consensus price target held steady at US$116, with the latest estimates not enough to have an impact on analysts' estimated valuations.

Still, 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 2024, and you can see them free on our platform here.

You can also see whether J.B. Hunt Transport Services is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.