3. J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) — This container fleet operator was one of the first in its industry to stake a position in intermodal, entering the segment in 1989. It made it a major part of operations since, and intermodal accounted for 62% of total revenue and 77% of total operating income in the first quarter of 2013. Both figures are up compared to the same period in 2012, and the company now captures nearly one-third of all domestic intermodal revenue.
To remain dominant, Hunt added more containers over the past year than any competitor. With tighter capacity in the truck market, this resulted in 19% Eastern network growth and 10% transcontinental growth during the first three months of the year. It expects these conditions to continue going forward.
4. Swift Transportation Co (NYSE:SWFT) — Concentrating on short- to medium-haul lanes between terminals and dedicated customer locations, this $3.3 billion truckload giant has increasingly focused during the past 10 years on intermodal transport across the U.S., Mexico and Canada. In the second half of 2012, it added about 2,000 containers to pursue even more intermodal opportunities.
As a result, Swift Transportation Co (NYSE:SWFT) saw intermodal revenue grow by more than 50% last year over 2011. And the company plans to build on that going forward. At an investor day conference in mid-May, executives said their current 2% share of total domestic load counts provided “opportunities for continued double-digit growth.”
5. Hub Group Inc (NASDAQ:HUBG) — This 41-year-old company describes itself as an asset-light provider of freight transportation management, which is a tongue-twisting way to say it outsources integrated transportation services including intermodal to a wide range of shippers. Also known as a 3PL, or third-party logistics provider, the firm lays claim to about 18% of all domestic intermodal revenue, second only to J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT).
In the first quarter of 2013, Hub Group Inc (NASDAQ:HUBG) reported income rose 12% and earnings per share climbed 14% compared to the prior year. Intermodal revenue increased 6% to $427 million during the quarter and executives said they expect EPS in 2013 between $2.00-$2.15 — compared to $1.83 in 2012 and $1.65 in 2011.
The bottom line
Changes are coming quickly that will further make truckload transport more challenging and expensive. These top intermodal providers are positioned well to gain from the truckers’ loss.
The article New Trucking Rules Could Boost Intermodal Segment originally appeared on Fool.com and is written by Howard Rothman.
Howard Rothman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Howard is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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