Dj J.B. Hunt Transport Services Inc. Stock Underperforms Friday When Compared To Competitors Despite Daily Gains

Predicting the actions of an incoming administration is always tricky, and that's doubly true for someone with a penchant for saber rattling like Donald Trump. While Trump seems committed to another round of tariffs (especially aimed at Chinese imports), the actual size and scope of these moves remains to be seen.

Many business leaders and executives are preparing for new tariffs by readying consumers for increased costs, and the retail sector could be hit hard if the most protective policies come to fruition.

However, not every company stands to suffer from tariff expansion. Some industries, like domestic shippers and specialty retailers, saw a boost in the wake of the election results.

Here are five stocks that stand to benefit from American tariffs on foreign imports.

Methodology

To find stocks that will benefit from tariffs, we need to look for firms with reliable production alternatives outside China and the ability to pass on extra costs to consumers.

If a company’s main competitors have high import costs or lack that kind of pricing power, even better.

Let’s go through the list:

AutoZone Inc.

DIY auto store stocks have soared in the post-pandemic era, and the two clear winners have been AutoZone and Oreilly Automotive Inc. . Both companies have had little issue raising prices during previous tariff implementations, and investors have no reason to assume they won't do the same in the face of the next round.

AutoZone is uniquely positioned to benefit from a higher tariff environment. Even when the first round of tariffs was administered during Trump's initial term, AutoZone still managed to improve its profit margins despite higher costs. Additionally, DIY auto parts stores often hold significant pricing power over consumers since fixing a car is usually a non-negotiable part of life in America (especially in the suburbs). CEO Philip Daniele recently stated that the company intends to pass any tariff increases back onto consumers, which could prompt a flurry of car repair activity before the calendar flips to 2025.

A month has gone by since the last earnings report for Old Dominion Freight Line (ODFL). Shares have added about 13.9% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Old Dominion due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

In-Line Earnings at Old Dominion in Q3

Old Dominion Freight Line’s third-quarter 2024 earnings per share of $1.43 was in line with the Zacks Consensus Estimate but decreased 7.1% year over year. Revenues of $1.47 billion fell short of the Zacks Consensus Estimate of $1.51 billion and decreased 3% year over year. A 4.8% decrease in less-than-truckload (“LTL”) tons per day hurt results.

Revenues from LTL services came in at $1.46 billion, down 2.9% year over year. Segmental revenues were below our projection of $1.53 billion. Revenues from other services fell 6.5% to $13.1 million, which was just below our projection of $13.7 million.

In the quarter under review, LTL weight per shipment dipped 1.4% and LTL revenue per shipment inched up 0.1%. LTL shipments and LTL shipments per day were down 1.9% and 3.4%, respectively, on a year-over-year basis. LTL revenue per hundredweight increased 1.5%.

Total operating expenses remained flat at $1.07 billion. Operating income decreased 9.7% to $401.8 million.

Old Dominion exited the September quarter with cash and cash equivalents of $74.2 million compared with $433.8 million in 2023-end. Long-term debt at the end of the quarter was $40 million compared with $60 million at 2023-end. Capital expenditures were $242.8 million. The matric incurred in the reported quarter.

The company paid out dividends worth $168.2 million and repurchased its shares worth $824.8 million in the first nine months of the year. For 2024, ODFL anticipates total capital expenditures to be $750 million. Of the total, $350 million is anticipated to be invested in real estate and service center expansion projects, $325 million in tractors and trailers and $75 million in information technology and other assets.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month.

The consensus estimate has shifted -9.5% due to these changes.

VGM Scores

Currently, Old Dominion has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Old Dominion has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

Performance of an Industry Player

Old Dominion belongs to the Zacks Transportation - Truck industry. Another stock from the same industry, JB Hunt (JBHT), has gained 3.3% over the past month. More than a month has passed since the company reported results for the quarter ended September 2024.

JB Hunt reported revenues of $3.07 billion in the last reported quarter, representing a year-over-year change of -3%. EPS of $1.49 for the same period compares with $1.80 a year ago.

JB Hunt is expected to post earnings of $1.68 per share for the current quarter, representing a year-over-year change of +14.3%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.1%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for JB Hunt. Also, the stock has a VGM Score of B.

Zacks Investment Research

Copa Holdings, S.A.’s CPA third-quarter 2024 earnings per share of $3.50 surpassed the Zacks Consensus Estimate of $3.48 but declined 20.3% year over year. Revenues of $854.7 million lagged the Zacks Consensus Estimate of $860 million and fell by 1.5% year over year due to upbeat passenger revenues.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Copa Holdings, S.A. Price, Consensus and EPS Surprise

Copa Holdings, S.A. price-consensus-eps-surprise-chart | Copa Holdings, S.A. Quote

Passenger revenues (which contributed 95.8% to the top line) decreased 1.8% from the third quarter of 2023. The downside was mainly led by the last-minute suspension of flights between Panama and Venezuela at the end of July, weaker currencies in Latin America and increased industry capacity in the region. As a result, passenger yield declined 8.7% year over year.

Cargo and mail revenues grew 4.3% to $24.45 million due to higher volumes, partly offset by lower cargo yields. Other operating revenues were $11.88 million, up 8.3% year over year due to higher ConnectMiles revenues from non-air partners.

The operating margin declined 3.3 percentage points from the year-ago quarter.

CPA’s Other Financial Details

On a consolidated basis, Copa Holdings’ traffic (measured in revenue passenger miles) grew 7.6% year over year, and capacity (measured in available seat miles) increased 9.5% from the year-ago quarter. With traffic growth outpacing capacity expansion, the load factor (percentage of seats filled by passengers) decreased 1.6 percentage points to 86.2% in the reported quarter.

Passenger revenue per available seat miles dropped 10.3% year over year to 10.5 cents. Revenue per available seat mile (RASM) declined 10.1% to 11 cents. Cost per available seat mile dipped 6.2%. Excluding fuel, the metric fell 1.6%. The average fuel price per gallon fell by 13.3% to $2.60.

Total operating expenses increased 2.8% year over year to $681 million due to higher capacity, offset by lower sales, and distribution and fuel costs. Expenses on wages, salaries, benefits and other employee expenses rose 8.7% year over year, whereas maintenance, materials and repairs increased 18.1% year over year. Sales and distribution costs decreased 8% year over year, and fuel costs fell by 5.3% in the same period. Passenger servicing costs grew 13.3% from the year-ago quarter. Other operating and administrative expenses increased 15.2% from the third quarter of 2023.

Copa Holdings exited the third quarter with cash and cash equivalents of $275.25 million compared with $200.64 million at the prior-quarter end. Total debt, including lease liabilities, was $1.9 billion compared with $1.8 billion at the second-quarter end.

CPA ended the third quarter with a consolidated fleet of 110 aircraft, which comprises 67 Boeing 737-800s, 32 Boeing 737 MAX 9s, nine Boeing 737-700s, one Boeing 737 MAX 8 and one Boeing 737-800 freighter.

CPA’s 2024 & 2025 Outlook

CPA’s management now expects consolidated capacity to grow 9% year over year, and the operating margin is expected to come in the range of 21-22%. RASM is now expected to be 11.4 cents (prior view: 11.5 cents).

The load factor is now expected to be 86% (prior view: 86.5%).

Non-fuel unit costs are anticipated to be 5.8 cents. The fuel cost is expected to be $2.67 per gallon, down from the prior guidance of $2.70.

For 2025, the company anticipates increasing its capacity by approximately 7% to 9% compared to 2024, with unit costs, excluding fuel (Ex-Fuel CASM), projected to be around 5.8 cents.

CPA’s Zacks Rank

Copa Holdings currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Q3 Performances of Other Transportation Companies

Delta Air Lines DAL reported third-quarter 2024 earnings (excluding 47 cents from non-recurring items) of $1.50 per share, which fell short of the Zacks Consensus Estimate of $1.56. Earnings decreased 26.11% on a year-over-year basis due to high labor costs.

Revenues of $15.68 billion surpassed the Zacks Consensus Estimate of $15.37 billion and increased 1.2% on a year-over-year basis, driven by strong air travel demand. Adjusted operating revenues (excluding third-party refinery sales) totaled $14.59 billion, flat year over year.

Norfolk Southern Corporation’s NSC third-quarter 2024 earnings (excluding $1.6 from non-recurring items) of $3.25 per share beat the Zacks Consensus Estimate of $3.10 and increased 22.6% year over year due to lower costs.

Railway operating revenues were $3.05 billion in the quarter under review, lagging the Zacks Consensus Estimate of $3.09 billion. However, the top line increased 2.7% year over year, with the Merchandise and Intermodal segments registering an improvement in revenues.

J.B. Hunt Transport Services’ JBHT third-quarter 2024 earnings of $1.49 per share outpaced the Zacks Consensus Estimate of $1.42 but declined 17.2% year over year.

Total operating revenues of $3.07 billion surpassed the Zacks Consensus Estimate of $3.04 billion but fell 3% year over year. The operating income for the September quarter decreased 7% year over year to $224.1 million.

Zacks Investment Research

Golar LNG Limited (GLNG) reported third-quarter 2024 earnings of 53 cents per share, which beat the Zacks Consensus Estimate of 37 cents. However, the company’s bottom line declined year over year.

Find the latest EPS estimates and surprises on ZacksEarnings Calendar.

Revenues of $64.8 million met the Zacks Consensus Estimate. The top line declined 4% year over year.

Adjusted EBITDA of $59 million declined 21% year over year.

Golar LNG Limited Price, Consensus and EPS Surprise

Golar LNG Limited price-consensus-eps-surprise-chart | Golar LNG Limited Quote

GLNG exited the third quarter of 2024 with cash and cash equivalents of $732.06 million compared with $527.59 million at the end of the prior quarter.

GLNG’s share of contractual debt at the end of the reported quarter increased 25% to $1.46 billion.

GLNG’s board of directors approved a third-quarter 2024 dividend of 25 cents per share. The dividend will be paid on or around Dec. 2 to shareholders of record at the close of business on Nov. 25, 2024.

As of Sept. 30, 2024, 104.0 million shares were issued and outstanding. Of the $150.0 million approved share buyback scheme, $74.1 million remains available.

GLNG’s Zacks Rank and Price Performance

Currently, GLNG carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

So far this year, shares of GLNG have gained 56.5%, outperforming the industry’s growth of 20.2%.

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