27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
J.B. Hunt Transport Services Inc. (NASDAQ:JBHT) reported fourth quarter 2019 earnings per share (EPS) of $1.35 versus the consensus estimate of $1.52. The earnings increase was 67% higher compared to the same period in 2018, which was negatively impacted by $134 million in charges associated with its arbitration with BNSF Railway. Excluding the charges, J.B. Hunt reported EPS of $1.78 in the fourth quarter 2018.
The Arkansas-based company reported a 5.7% year-over-year increase in revenue to $2.45 billion. J.B. Hunt reported operating income of $205 million, a 20% decline from the 2018 period excluding that period's arbitration expense. The company noted higher rail purchased transportation costs, increased rental expense in Final Mile Services, lower gross margins in its Integrated Capacity Solutions (ICS) business and increased IT investment as some of the drags on operating income in the fourth quarter.
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J.B. Hunt's Consolidated Key Performance Indicators
Marketplace For J.B. Hunt 360°
Marketplace for J.B. Hunt 360°, a digital marketplace for carriers and shippers to match loads, saw total freight transactions increase 66% to $289 million. ICS revenue generated through the platform accounted for $225 million, with intermodal executing $47 million and truckload $17 million on the platform.
Intermodal
J.B. Hunt reported revenue of $1.27 billion, in line with the fourth quarter of 2018 on total load growth of 1.6% and a 1.2% decline in revenue per load. This is likely significantly better than what the rest of the industry experienced as container volumes on the U.S. Class I railroads declined 6.6% year-over-year in the fourth quarter. Transcontinental loads were up 8% with loads in the company's Eastern network declining by the same amount.
Excluding the arbitration charges from the fourth quarter of 2018, intermodal operating income declined 21% year-over-year to $131 million. The company cited increased rail purchased transportation rates, higher container repositioning costs and rail service interruptions as some of the culprits.
Intermodal Key Performance Indicators
Dedicated
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Dedicated revenue increased 20% year-over-year to $717 million as total loads increased 17% and revenue per truck per week climbed 9%, 11% higher excluding fuel surcharges. The dedicated truck count increased by 972 trucks year-over-year, 153 higher compared to the third quarter of 2019. Management said that an acquisition, increased rates and improved efficiencies within customer accounts led to the revenue growth. Final Mile Services reported a $59 million revenue increase largely due to the acquisition. Dedicated operating income was up 34% year-over-year at $80 million.
Dedicated Key Performance Indicators
ICS
ICS revenue increased 9% year-over-year to $377 million, with total loads increasing 3% and revenue per load up 6%. Contractual brokerage volumes accounted for 73% of total load volume, 65% of revenue. The company's contractual business accounted for 71% of loads and only 53% of the revenue in the year-ago period. The division reported an operating loss of $11.8 million as gross margins declined 630 basis points to 10.6%. Management called out lower gross margins, cost increases associated with expanding the capabilities of Marketplace for J.B. Hunt 360° and higher personnel costs as the reasons for the underperformance.
ICS and Truck Key Performance Indicators
Truck
Truck revenue declined 20% year-over-year as loads were down 9%, rates per loaded mile declined 11% and length of haul was down 2%. Revenue per tractor per week was down 11% year-over-year at $4,017. Management said that contractual rates were flat year-over-year. Operating income in the division fell by more than half to $6 million as lower spot market loads and an increase in empty miles impacted results.
J.B. Hunt will host a conference call to discuss these results with analysts at 10 a.m. Friday.
JBHT Stock Price Chart – SONAR: STOCK.JBHT
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27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.