J.B. Hunt Transport Services Inc.JBHT

Morningstar Rating

Stock Research and Analysis

by Anthony Dayrit

J.B. Hunt Transport Services has carved out a narrow economic moat by leveraging its traditional truckload business to build a leading market position in intermodal shipping. The fruits of these actions show up on the bottom line--during the last decade, Read more

Bulls Say

J.B. Hunt's status as a leader in intermodal shipping leaves it less vulnerable to cyclical downturns than trucking-only competitors.

A diverse service portfolio, which ranges from providing specialized fleets to third-party logistics, gives the company an edge in an otherwise commodified trucking industry.

J.B. Hunt's strategy of moving toward more asset-light transportation services and higher-margin businesses may help it boost long-term profitability. Read more

Bears Say

The success of J.B. Hunt's intermodal operations rests in the hands of its partner railroads. The company's costs of transportation and customer satisfaction depend heavily on the performance of these suppliers.

Although J.B. Hunt possesses a large customer base, it does have significant client concentration: Its top 10 customers account for about 35% of revenue, and Wal-Mart WMT alone accounts for 9% of total sales.

J.B. Hunt's traditional trucking segment still accounts for a significant portion of the company's business. The segment's high operating leverage and relatively low barriers to entry are likely to weigh down overall profitability during a weak demand environment. Read more

Strategy

J.B. Hunt's strategy is to expand its intermodal and dedicated contract services in order to position the company competitively during a time of weak trucking demand. Although the company aims to provide Read more

Management

We think J.B. Hunt possesses a solid management team that is on the right track in positioning the company competitively for the future. Management has focused on diversifying the company's sources of income while leveraging its core competency of truckload Read more

Profile

J.B. Hunt is one of the top 10 freight shipping firms in North America in terms of revenue. The company operates four segments: intermodal delivery, which transports products Read more

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