J.B. Hunt Transport Services (NASDAQ:JBHT) is a basic industry stock that has the double-digit growth projections I like to see. The trucking industry is vital to our economy and a transportation company that combines freight by both road and rail through its intermodal franchise is a plus.
During the past 2 1/2 months while the market as measured by the Value Line Index has been flat shares of J.B. Hunt are up 14%:
The company offers a full range of transportation solutions on both leased and company owned facilities and its operations cover the U.S., Canada and Mexico.
Factors to consider:
- 88% Barchart technical buy signal
- Trend Spotter buy signal
- Above its 20-, 50- and 100-day moving averages
- 4 new highs and up 3.32% in the last month
- Relative Strength Index 68.34%
- Barchart computes a technical support level at 57.90
- Recently traded at 60.29 with a 50-day moving average of 55.09
- 22 Wall Street brokerage firms assigned 30 analysts to make recommendations to their clients
- Revenue is projected to increase by 11.50% this year and another 10.50% next year
- Earnings are estimated to increase by 22.30% this year, an additional 16.30% next year and continue to increase annually at the rate of 19.47% for the next 5 years
- The 23.46 P/E ratio is not out of line in a 15.2 P/E market
- The dividend rate of 1% is about 20% of predicted earnings
- The company is increasing market share in both its rail and road transport segments
- The company has a B++ financial strength rating
- Wall Street analysts have made 7 strong buy, 7 buy, 15 hold and one under perform recommendations to their clients
- 202 individual investors on Motley Fool have voted the stock a 76% chance of beating the market
- Short interest is rapidly dropping from about 1.4 million shares in the middle of last month to around 800K shares recently.
Always compare your stock to price movement of its competitors. During the past year JBHT was up 41% while Old Dominion (NASDAQ:ODFL) was up 32%, Con-Way (NYSE:CNW) was down 7% and Saia (NASDAQ:SAIA) was up 61%:
Conclusion: J. B. Hunt Transport Services is in a basic industry and has analysts forecasts of double-digit increases in both revenue and earnings. It is increasing market share in most of its segments and can be acquired for a reasonable P/E. This looks to be a solid investment in a solid company and will benefit greatly as the economy recovers. As always monitor the moving averages and turtle channels to sense market weaknesses:
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in JBHT over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.