JB Hunt Falls on Disappointing Revenue
JB Hunt (NASDAQ: JBHT) met Wall Street earnings expectations aided by lower fuel costs despite sales being lower than expected.
The transportation company's SG&A expenses were $256 million, or about 20.4 percent of revenue – the lowest revenue percentage in the past five years, mainly due to lower fuel prices compared to previous quarters.
Earnings rose 23 percent to $80.5 million (67 cents a share), up from $65.7 million (53 cents a share) in the same period last year. That met analyst expectations of 67 cents a share. The company's gross margins were 15.5 percent, higher than the previous quarter.
Revenue was $1.26 billion, short of the $1.3 billion analysts had been expecting.
It was seen as disappointing for a growth stock to meet expectations through cost cuts. Shares fell more than 7 percent to $53.92 in morning trading.
JB Hunt had been one of the rare stocks that rose strongly in June partly on the drop in fuel prices. The stock rose more than 12 percent from the start of the second quarter to its June peak.
Also a disappointment was that the company's intermodal segment – its largest – saw revenue rise 13 percent from the same period a year earlier as some had expected stronger growth.
Intermodal volume – shipping goods in containers that can fit on both trucks and trains-- was 12.6 percent, down from 16 percent in the first quarter.
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