HUNT (JB) TRANSPRT SVCS INC (NASDAQ:JBHT): A Reliable Dividend Stock with Strong Growth and Financial Health

Investors looking for dependable dividend-paying stocks frequently use filters to find companies with good dividend ratings, steady profitability, and strong financials. The "Best Dividend Stocks" screen applied here picks these candidates by setting basic requirements: a ChartMill Dividend Rating of 7 or more, a Profitability Rating of 5 or higher, and a Health Rating of 5 or above. These standards help ensure the chosen stocks provide appealing yields while also having the financial stability to maintain and increase their dividends. One stock that fits these conditions is J.B. Hunt Transport Services Inc (NASDAQ:JBHT), a logistics and transportation firm known for steady dividend payments.

Dividend Strength: A Steady Payout

JBHT is notable for its dependable dividends, receiving a ChartMill Dividend Rating of 7. Key elements behind this score include:

• Dividend Growth: The company has raised its dividend by 10.61% annually over the last five years, showing a dedication to shareholder returns.
• Payout Sustainability: With a payout ratio of 31.21%, JBHT keeps enough earnings to reinvest in its business while keeping dividends steady. This is far below the warning level of 80%, lowering the chance of a reduction.
• Longevity: JBHT has paid dividends for at least 10 straight years without cuts, making it a reliable choice for income-focused investors.

While its current dividend yield of 1.17% is lower than the S&P 500 average (2.34%), the mix of growth and stability makes it attractive for those focused on long-term dividend growth rather than high short-term yields.

Profitability and Financial Health: Supporting the Dividend

A lasting dividend depends on steady profits and a solid balance sheet. JBHT’s Profitability Rating of 5 reflects:

• Consistent Earnings: The company has been profitable for five consecutive years, with a Return on Equity (ROE) of 14.51%, better than 70% of its industry peers.
• Stable Cash Flow: Positive operating cash flow over the past five years means JBHT can pay dividends without relying too much on borrowing.

Its Health Rating of 6 points to a mostly strong financial position, though with some details to note:

• Solvency Strengths: A low Debt-to-Equity ratio (0.23) and a solid Altman-Z score (4.93) suggest little risk of financial trouble.
• Liquidity Concerns: A Current Ratio of 0.89 indicates tighter short-term liquidity, but this is balanced by steady cash flow and manageable debt.

Valuation and Growth Potential

JBHT trades at a P/E ratio of 26.19, slightly under the industry average (34.69), which suggests fair pricing compared to peers. Analysts expect 17.13% annual EPS growth in the coming years, which could help support future dividend hikes.

Why These Metrics Are Important

The screening rules match key ideas in dividend investing:

• A high Dividend Rating confirms the dividend is stable and growing.
• Profitability shows the company earns enough to cover dividends.
• Financial Health lowers the risk of dividend cuts during economic challenges.

For more details on JBHT’s fundamentals, see its full fundamental analysis report here.

Finding More Dividend Options

JBHT is just one of many stocks that meet the "Best Dividend Stocks" standards. To find other strong dividend payers, run the screen yourself and adjust filters like yield or market cap to fit your strategy.

Disclaimer: This article is not investment advice. Always do your own research or consult a financial advisor before making investment decisions.