Hub Group, Inc. Just Missed Revenue By 5.0%: Here's What Analysts Think Will Happen Next

It's been a pretty great week for Hub Group, Inc. (NASDAQ:HUBG) shareholders, with its shares surging 11% to US$35.84 in the week since its latest first-quarter results. Hub Group missed revenue estimates by 5.0%, coming in atUS$915m, although statutory earnings per share (EPS) of US$0.44 beat expectations, coming in 3.0% ahead of analyst estimates. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, Hub Group's 13 analysts currently expect revenues in 2025 to be US$3.80b, approximately in line with the last 12 months. Statutory earnings per share are predicted to swell 11% to US$1.89. Before this earnings report, the analysts had been forecasting revenues of US$4.02b and earnings per share (EPS) of US$2.11 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

See our latest analysis for Hub Group

The consensus price target fell 9.6% to US$38.28, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Hub Group at US$45.00 per share, while the most bearish prices it at US$33.13. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hub Group's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 2.0% by the end of 2025. This indicates a significant reduction from annual growth of 3.2% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.9% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Hub Group is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Hub Group analysts - going out to 2027, and you can see them free on our platform here.

It might also be worth considering whether Hub Group's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.