J.B. Hunt's Intermodal Growth Shows Promise Despite Lagging 'Big Three' Ports: Analyst

Zinger Key Points

J.B. Hunt's intermodal growth in Q3 lags behind the "Big Three" ports, but shows promise with strong performance in transcontinental routes.
Analyst predicts a potential growth boost for J.B. Hunt as West Coast ports regain share, despite slower growth compared to the industry.

Goldman Sachs analyst Jordan Alliger reiterated the Buy rating on J.B. Hunt Transport Services, Inc. JBHT.

The analyst’s take on J.B. Hunt suggests a positive outlook. The company showed a 5% growth in intermodal in the third quarter of 2024, driven by a 7% increase in transcontinental and double-digit growth in Southern California.

However, according to Alliger, the company’s intermodal growth lags behind the “Big Three” ports, which saw an average increase of 27.5%.

The Big Three West Coast Ports, represented by L.A., Long Beach, and Oakland, reported a 20% year-over-year increase in November 2024 traffic, surpassing the pre-pandemic five-year average of 2%.

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However, sequentially, the combined data showed a 6% month-over-month decline, which is below the five-year average.

Despite this, the analyst predicts that the pace of growth could pick up again for J.B. Hunt toward the end of 2024 and into 2025, ahead of any potential tariffs.

The shift towards domestic intermodal is showing positive signs, and there is potential for more imports to move out of West Coast warehouses.

The West Coast ports, regaining share in 2023 and 2024, may further boost J.B. Hunt’s performance if more ocean freight is diverted to the West Coast amid ongoing contract uncertainties on the East Coast. Despite this, the company’s growth is still behind the broader industry’s pace, but the outlook remains favorable with potential upside, Alliger adds.

Price Action: JBHT shares are trading lower by 0.76% to $170.70 at the last check Friday.

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