JB Hunt Transport Services Inc (JBHT)

Conclusion

J.B. Hunt Transport Services is a US transport and logistics company that runs intermodal, dedicated contract, brokerage, final mile and truckload services. At 224.32 USD on 9 November 2026, its market capitalisation is 21.06 billion USD.

The verdict is overvalued. The P/E of 31.2x is 17.6% above its ten-year median of 26.5x, and EV/EBITDA of 13.5x is 7.2% above its median of 12.6x. P/FCF of 21.8x is 49.1% below its median of 42.8x. The DCF gives 141.64 USD per share at a discount rate of 11.2%. The fair value band runs from 146.96 to 220.44 USD with a midpoint of 183.70 USD, and the margin of safety is -18.1% at the current price. The reverse DCF implies growth of 12.3% a year, against revenue growth of 4.5% a year over five years and free cash flow per share growth of 21.9% a year over the same period.

The strongest numbers are interest coverage of 14.5x, an Altman Z-score of 6.33 and ROIC of 14.7% against a WACC of 10.8%. The weakest are free cash flow conversion of 54.0% over five years, revenue growth of -6.8% a year over three years, and a 7.4% cut to current-year estimates over 90 days.

Financial health

Financial strength is green, held up by interest coverage of 14.5x, net debt to EBITDA of 0.68x and a current ratio of 1.23x. The quick ratio is 1.02x and debt to equity is 0.31x. The Altman Z-score is 6.33, in the safe zone, although that model was designed for manufacturers and this company is a transport business. Insolvency risk: low, about 0.6% by the estimate of the Ohlson model over one to two years.

Earnings quality

Earnings quality is yellow, mainly because cash conversion is weak over the cycle. Free cash flow conversion is 143.0% on a trailing basis but only 54.0% over five years. Accruals are -13.0% and stock-based compensation is 0.54% of revenue, leaving free cash flow after it at 893.9 million USD. The share count fell at a five-year compound rate of 1.8%, which points to buybacks. The Piotroski score is 7 of 9. The Beneish M-score is not available. Seven of the last eight quarters beat estimates, by 4.8% on average, but estimates are being cut: the current-year estimate is down 7.4% over 90 days, with 20 downward revisions and no upward revisions in the last 30 days.

Profitability

Profitability is green, based on ROIC of 14.7% against a WACC of 10.8%, a ROIC minus WACC value of 3.8%. Margins sit below their ten-year medians: gross margin is 15.0% against 16.6%, operating margin 7.2% against 8.0%, and net margin 5.1% against 5.7%. The five-year median ROIC is 12.6%. Return on equity of 18.6% is flattered by leverage. The DuPont split shows a net margin of 5.0%, an asset turnover of 1.47x and an equity multiplier of 2.28x.

Growth

Growth is green, supported mainly by consistent revenue and next year's EPS estimate growth of 35.8%. Revenue compounded at -6.8% over three years, 4.5% over five years and 6.9% over ten years. EPS compounded at -12.7% over three years, 5.3% over five and 5.3% over ten. Revenue grew in 7 of 10 comparable years. Free cash flow per share compounded at 62.9% over three years and 21.9% over five. The three-year figures reflect a weak recent period, so the five-year and ten-year rates are the better guide to long-run growth.

Valuation

Valuation is red, and the verdict is overvalued. Against ten-year medians, the P/E of 31.2x is at a premium of 17.6% to its median of 26.5x, EV/EBITDA of 13.5x is at a premium of 7.2%, and P/FCF of 21.8x is at a discount of 49.1%. P/S of 1.58x is 3.7% below its median and P/B of 5.80x is 0.6% below. The DCF gives 141.64 USD per share at a discount rate of 11.2%, with the terminal value making up 47.0% of it. The fair value from historical multiples is 225.75 USD. The fair value band runs from 146.96 to 220.44 USD with a midpoint of 183.70 USD, and the margin of safety is -18.1% at 224.32 USD. The reverse DCF implies growth of 12.3%. The dividend yield is 0.8% and the payout on free cash flow is 17.5%. The fair value is an order-of-magnitude estimate built on fixed assumptions, including a 5% equity risk premium and capped growth. It is not a price target.

Risks

The main risk is that cash generation lags reported earnings. Five-year free cash flow conversion of 54.0% means that earnings have not reliably turned into cash, so a further fall in conversion would weaken the case for the current multiples. Three-year revenue compounding of -6.8% and three-year EPS compounding of -12.7% show that the business has shrunk recently. Continued downward estimate revisions would pull the implied growth further from what is being delivered. The Beneish M-score is not available, so the earnings-manipulation check is incomplete. This analysis has no debt maturity schedule and no revenue by segment, so it cannot judge refinancing risk or which business lines drive results.