JB Hunt sell-off puts pressure on transport sector after rally

Ryder System

17/07/2024 17:09

By Sinéad Carew
       July 17 (Reuters) - Shares in JB Hunt Transport Services
Inc  JBHT.O  were down more than 7% on Wednesday, on course to
snap a five-day rally and weighing heavily on the broader
transportation sector after the trucking company's quarterly
report fell short of expectations.
    JB Hunt last traded at $162.88 after closing Tuesday's
session at $176, its highest level since April 16, the
culmination of a 5-day rally in which it gained over 13%.
    Other transport companies also lost ground and JB Hunt was
the biggest drag on the Dow Jones Transport average index
 .DJT , down more than 1%, and was leading percentage declines
in the index, which is viewed as a bellwether for the U.S.
economy.  
    Late on Tuesday JB Hunt had reported a 24% fall in
second-quarter profit and a 7% drop in revenue with both missing
Wall Street expectations. 
    Several Wall Street analysts cut their price targets for the
stock after the report while some raised their price targets. 
    "Once again, JBHT's results reflect a freight environment
that is still negatively impacted by excess capacity that is
pressuring price and margins," wrote Benchmark analyst
Christopher Kuhn. 
    But Kuhn, who has a buy rating and a $185 price target on
the stock, pointed to some encouraging comments citing the
company's reference to "more normalized seasonal patterns" and a
second quarter that felt more like pre-pandemic conditions.
    Falling along with JB Hunt on Wednesday were Old Dominion
 ODFL.O , down 1.8%, Landstar  LSTR.O , off 1.4%, and Kirby Corp
 KEX.N , down 1.6%. Fedex  FDX.N  was down 1.4% while Ryder
System  R.N  was off 0.8%.
    The Dow transports index was falling after five straight
days of gains, culminating in Tuesday's close at its highest
level since early August. 

 (Reporting by Sinéad Carew. Editing by Jane Merriman)
 ((sinead.carew@thomsonreuters.com; +13322191897;))