Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

The Bull Thesis For Truckers: JB Hunt, Heartland Express, USA Truck Shares Upgraded To Buy

Courtesy of Benzinga.

The Bull Thesis For Truckers: JB Hunt, Heartland Express, USA Truck Shares Upgraded To Buy

The trucking industry may soon enjoy a major uptick in pricing. Despite strong stock performances among trucking stocks of late, Stifel analyst John Larkin saw enough evidence that trucking rate hikes are on the horizon to upgrade J B Hunt Transport Services Inc (NASDAQ: JBHT), Heartland Express, Inc. (NASDAQ: HTLD) and USA Truck, Inc. (NASDAQ: USAK) from Hold to Buy on Thursday.

After speaking with a large group of industry insiders, including carriers, logisticians, shippers, consultants, vendors and investors, Larkin is convinced that contract pricing will soon catch up to rising demand. (See Larkin’s track record here.) 

“With an improved pricing outlook versus our previous, more conservative outlook, our thought process suggests that average price increases will materialize to the tune of 5-10 percent (and in some cases above the top of the range) during the next iteration of contract negotiations versus our previous estimates of 1.5-2.5 percent,” Larkin said.

According to Larkin, hurricanes Harvey and Irma added significant demand to an already hot market, and demand from the holiday shopping season will soon pick up as well.

“Due to the timing of the negotiations, we are modeling the price increases to be less visible in 2H17, begin to build through 2018, and become close to fully realized in 3Q18 at which point in time the pricing concessions will become more fully obvious.”

The three upgraded stocks are already up between 33 and 41 percent each in the past year, but Larkin says demand acceleration will pave the way for more upside.

Stifel has a $125 price target for J.B. Hunt, a $28 price target for Heartland Express and a $15 price target for USA Truck.

Related Links:

The Bear Thesis For Truckers: Tesla To Conquer All

Will Q2 Costs Detour JB Hunt From Hitting Full Year Guidance? 

Latest Ratings for JBHT

Date Firm Action From To
Sep 2017 Stifel Nicolaus Upgrades Hold Buy
Jul 2017 Morgan Stanley Maintains Equal-Weight
May 2017 JP Morgan Initiates Coverage On Overweight

View More Analyst Ratings for JBHT


View the Latest Analyst Ratings

Posted-In: John Larkin StifelAnalyst Color Long Ideas Upgrades Price Target Analyst Ratings Trading Ideas Best of Benzinga


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!