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In our back yard: J.B. Hunt Transport Services remains a good buy after all these years.

Peter Lynch once wrote that some of the best buys are in your back yard.

Let's face it. J.B. Hunt Transport Services Inc. of Lowell is a name common to almost every Arkansan.

But how many Arkansans actually own J.B. Hunt stock?

Hunt founded the company in 1962.

In 1983, he took the company private. That year, the trucking firm was the 80th-largest carrier in the country, up from 129th the previous year. It had the best operating ratio in the trucking industry.

During 1984, the company increased its fleet size by 50 percent. It was the country's 49th-largest carrier in '84 and again had the best operating ratio in the industry.

A two-for-one stock split occurred in 1986 as Hunt added its 1,000th truck. Ranked by then as the 25th-largest carrier, the company once more had the best operating ratio in the trucking industry.

The success story continued.

The following year saw seven terminals added along with the addition of Hunt's 2,000th truck. Hunt moved to 18th on the list of largest carriers.

Are you beginning to get the picture?

Here is a company toiling away in Lowell. But few Americans are aware of the growth that is taking place.

The story gets better.

During 1988, Hunt entered the international market with penetration into Mexico and Canada. That same year saw the addition of the company's 3,000th truck. By the end of the year, this Arkansas success story had become the 13th-largest U.S. trucking company.

An intermodal joint venture known as "Quantum" was initiated with Santa Fe Railway in December 1989. The 4,000th truck was added that year.

Last year, the company saw what might have been the most significant indication of the value of its services. In the face of what now appears to be a more severe recession than originally thought, Hunt was able to increase revenues by 27 percent.

I expect almost 6,000 tractors, 10,000 48-foot trailers and 5,000 53-foot trailers to be in the Hunt operation by the end of 1992.

As you can see from this brief chronological record, Hunt has been able to maintain a growth rate that makes other companies salivate.

Several factors account for the growth.

First, investors should compliment the Hunt management team for having the vision to make such growth possible. Of the 23.1 million shares outstanding, officers and directors own about 63 percent, including 46 percent held by J.B. Hunt. It is nice to see executives put their money where their mouths are.

Of last year's Top 10 motor carriers, nine grew by about 200 percent during the 1980s.

Hunt, meanwhile, grew by 2,200 percent.

It is still early in the decade. It's not too late to get in on the growth.

Don't let this backyarder get away.

Michael Parnell is vice president of investments in the Little Rock office of PaineWebber Inc. Parnell holds a bachelor's degree in agricultural economics from the University of Arkansas at Fayetteville.
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Title Annotation:Stock Talk
Author:Parnell, Michael
Publication:Arkansas Business
Article Type:Company Profile
Date:Mar 29, 1992
Previous Article:Going public: Burlington Industries Inc. ready to return to Wall Street.
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