J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) just released its first-quarter report and things are looking bullish. Results were good overall, with revenues beating analyst predictions by 4.7% to hit US$2.3b. Statutory earnings per share (EPS) came in at US$0.98, some 3.1% above whatthe analysts had expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the 19 analysts covering J.B. Hunt Transport Services provided consensus estimates of US$8.90b revenue in 2020, which would reflect a noticeable 4.9% decline on its sales over the past 12 months. Statutory earnings per share are expected to descend 13% to US$4.09 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$9.52b and earnings per share (EPS) of US$5.18 in 2020. The analysts seem less optimistic after the recent results, reducing their sales forecasts and making a large cut to earnings per share numbers.
The analysts made no major changes to their price target of US$104, suggesting the downgrades are not expected to have a long-term impact on J.B. Hunt Transport Services'valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic J.B. Hunt Transport Services analyst has a price target of US$117 per share, while the most pessimistic values it at US$87.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast revenue decline of 4.9%, 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 4.4% annually for the foreseeable future. It's pretty clear that J.B. Hunt Transport Services' revenues are expected to perform substantially worse than 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 revenues will perform worse than the wider industry. The consensus price target held steady at US$104, 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 2024, and you can see them free on our platform here.
Even so, be aware that J.B. Hunt Transport Services is showing 2 warning signs in our investment analysis , you should know about...
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.