Trucking firm’s gain best in state

15% rise Friday puts Arkansas Best up 96.5% for quarter

Arkansas Best’s stock almost doubled in the second quarter, by far the best performance of any major publicly traded company in the state.

Aided by an almost 15 percent jump in its price Friday, Arkansas Best closed the quarter with a 96.5 percent gain for the period.

The trucking firm announced Thursday after the market closed that its unioncovered employees in its ABF Freight Systems subsidiary had ratified a five-year contract, a move analysts felt could improve Arkansas Best’s earnings.

Fort Smith-based Arkansas Best continues to reduce its expenses and overhead, said Bob Williams, seniorvice president and managing director of Delta Trust Investments Inc. in Little Rock. The trucking firm had some of the highest labor costs in the industry before the agreement was reached, Williams said.

“During the quarter, Arkansas Best announced that due to ongoing labor negotiations, it had declined to enter into takeover talks with YRC Worldwide, which had expressed interest in acquiring the firm,” Williams said. “The financial markets have clearly interpreted these changes as positive.”

For the first six months of the year, Arkansas Best is up 140 percent, again the best of any stock in the state.

Home BancShares, which announced Tuesday that it had agreed to acquire Liber-ty Bancshares of Jonesboro, was up 38.4 percent for the quarter.

“Management at Home BancShares knows how to end a quarter on a positive note,” Williams said. “The expected benefits [of the Liberty acquisition] are substantial due to minimal market overlap.”

Home BancShares will add Wallace Fowler, chairman and chief executive officer for Liberty, to its board.

“Wallace is a great asset,” said Randy Dennis, president of DD&F Consulting Group, a Little Rock bank consulting firm. “He is tired and ready to retire, but even a retired Wallace Fowler works harder than most people.”

Another transportation firm, USA Truck of Van Buren, had the third-best return for the quarter at 31.2 percent.

Arkansas Best and USATruck have benefited from being in an industry that is one of the first to rebound in an economic recovery, Williams said.

USA Truck’s new chief executive officer, John Simone, has focused on improving assets and profitability “and it shows in their results,” Williams said.

Despite the high returns for Arkansas Best, Home Banc-Shares and USA Truck, the 16 companies in the Arkansas Index, which tracks the largest public companies based in the state, did not perform well as a whole.

Only seven of the stocks were up for the quarter, while nine declined.

First Federal Bancshares in Harrison had the worst performance of the quarter, losing 21 percent.

First Federal sold off a package of loans for a $2 million loss in April as it worked to clean up its loan portfolio, Williams said.

Business, Pages 25 on 06/29/2013

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