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HUBG

Hub Group NasdaqGS:HUBG Stock Report

Last Price

US$80.68

Market Cap

US$2.8b

7D

5.6%

1Y

26.1%

Updated

06 Aug, 2022

Data

Company Financials +
HUBG fundamental analysis
Snowflake Score
Valuation4/6
Future Growth0/6
Past Performance6/6
Financial Health6/6
Dividends0/6

HUBG Stock Overview

Hub Group, Inc., a supply chain solutions provider, offers transportation and logistics management services in North America.

Hub Group Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Hub Group
Historical stock prices
Current Share PriceUS$80.68
52 Week HighUS$87.21
52 Week LowUS$60.81
Beta0.91
1 Month Change13.70%
3 Month Change6.09%
1 Year Change26.06%
3 Year Change94.36%
5 Year Change127.59%
Change since IPO1,949.02%

Recent News & Updates

Jul 14
Is There Now An Opportunity In Hub Group, Inc. (NASDAQ:HUBG)?

Is There Now An Opportunity In Hub Group, Inc. (NASDAQ:HUBG)?

Hub Group, Inc. ( NASDAQ:HUBG ), might not be a large cap stock, but it saw a decent share price growth in the teens...

Jul 10

Hub Group: Innovative Business Model, But Not Cheap Enough Yet

Hub Group, Inc. is a supply chain solutions provider offering transportation and logistics management services. Under my worst-case scenario, I think that labor shortages, slowdowns, or stoppages may be likely. Among the recent innovations, in my view, new robotic process automation and artificial intelligence will likely improve efficiency and free cash flow generation. Hub Group, Inc. (HUBG) is launching many initiatives to become more efficient and more innovative. I also noted profit improvement initiatives, which will likely lead to revenue generation. With all that being said, I believe that the upside potential in the stock price is not sufficient to justify a position in the stock. There are many risks, which may push the stock price down. I may try to grab shares, but not at the current stock price. Keep in mind that I do like Hub Group, but I dislike its stock price. The Hub Group Mission Hub Group, Inc is a supply chain solutions provider offering transportation and logistics management services. The company provides services such as truckload, temperature-controlled, dedicated and regional trucking. Most clients come from the consumer products industry as well as the retail and ecommerce sector. Hence, a decline in any of these activities may lead to a decline in the company’s revenue. Investor Presentation I decided to research Hub Group once I noticed several profit improvement initiatives announced in a recent quarterly report. In my view, the most relevant are the efficiencies coming from sharing of equipment and drivers as well as the delivery of revenue under a new business line called Intermodal and Transportation Solutions: As part of our profit improvement initiatives we have focused on realizing efficiencies between our dedicated and drayage trucking operations, including through the sharing of equipment and drivers, and by leveraging a combined driver support services function. Our dedicated and drayage teams now operate as one combined organization. As a result, beginning in first quarter 2022 we now report revenue for these operations under the “Intermodal and Transportation Solutions” line of business. Source: Hub Group, Inc. Reports First Quarter 2022 Results Besides, management announced new investments in equipment and technology, which will likely enhance revenue generation from 2022. Among the new equipment, management expects to add more intermodal containers, GPS, driver tablets, and new software applications. Investor Presentation Investor Presentation Analysts Are Expecting Sales Growth, Positive Net Income, And Growing Free Cash Flow In my view, investment analysts are relatively optimistic about HUBG. They expect a decline in sales growth in 2023, but sales growth in 2022 is expected to be close to 27%. The EBITDA margin may be close to double digit, and operating margin may reach 8% to 6% from 2022 to 2024. Marketscreener.com With that about the income statement, the cash flow statement gets even more interesting. Estimates about HUBG include FCF/Sales between 4.3% and 3.25%. The capex/sales ratio is also expected to stand at around 3.6%. Have a look at the figures of analysts because I based some of my models on the estimates given by other financial analysts. marketscreener.com Management is also optimistic about the year 2022. In a recent presentation, HUBG delivered 2022 sales guidance of $5.3-$5.5 billion and capital expenditures close to $240-$265 million. I used some of these figures in my base case scenario: We expect that our 2022 diluted earnings per share will range from $9.00 to $10.00. We estimate revenue will range from $5.3 to $5.5 billion, and that gross margin as a percentage of revenue will range from 15.6% to 16.0%. We estimate our costs and expenses will range from $420 to $440 million for the year. We project our effective tax rate for the year will be 24-25%. We expect capital expenditures for 2022 to range from $240 to $265 million. Source: Hub Group, Inc. Reports First Quarter 2022 Results Base Case Scenario: Investments In Technology Could Lead To A Share Price Of $94 Under my base case scenario, I assumed that investments in technology will successfully enhance the company’s relationships with clients, drivers, and vendors. Among the recent innovations, in my view, new robotic process automation and artificial intelligence will likely improve efficiency and free cash flow generation: In 2021, we also delivered solutions using computer visioning, robotic process automation and artificial intelligence to create increased efficiency in our operations and back office functions. This included the automation of manual processes, using human augmentation solutions to allow our experienced supply chain professionals to make critical decisions while allowing a robot to complete the repeatable tasks, and developing learning-based robots to drive better decision support to the hands of operating teams. Source: 10-k Besides, I think that a lot of technological innovation will come from acquisitions of innovative competitors. Management has already reported meaningful acquisition of Choptank Transport, LLC and NonstopDelivery, LLC: On October 19, 2021, we acquired 100% of the equity interests of Choptank Transport, LLC. The acquisition added scale to our truck brokerage operation, enhanced our refrigerated trucking transportation services offering and complemented our growing fleet of refrigerated intermodal containers. On December 9, 2020, we acquired NonstopDelivery, LLC. NSD provides residential final mile delivery services throughout the United States. The financial results of NSD, since the date of acquisition, are included in our logistics line of business. Source: 10-k

Shareholder Returns

HUBGUS LogisticsUS Market
7D5.6%1.0%1.0%
1Y26.1%-3.1%-12.9%

Return vs Industry: HUBG exceeded the US Logistics industry which returned -3.1% over the past year.

Return vs Market: HUBG exceeded the US Market which returned -12.8% over the past year.

Price Volatility

Is HUBG's price volatile compared to industry and market?
HUBG volatility
HUBG Average Weekly Movement5.1%
Logistics Industry Average Movement6.7%
Market Average Movement7.9%
10% most volatile stocks in US Market17.1%
10% least volatile stocks in US Market3.2%

Stable Share Price: HUBG is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: HUBG's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19714,700David Yeagerhttps://www.hubgroup.com

Hub Group, Inc., a supply chain solutions provider, offers transportation and logistics management services in North America. The company’s transportation services include intermodal, truckload, less-than-truckload, flatbed, temperature-controlled, and dedicated and regional trucking, as well as final mile, railcar, small parcel, and international transportation. Its logistics services comprise full outsource logistics solution, transportation management, freight consolidation, warehousing and fulfillment, final mile delivery, and parcel and international services.

Hub Group Fundamentals Summary

How do Hub Group's earnings and revenue compare to its market cap?
HUBG fundamental statistics
Market CapUS$2.80b
Earnings (TTM)US$318.00m
Revenue (TTM)US$5.03b

8.8x

P/E Ratio

0.6x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
HUBG income statement (TTM)
RevenueUS$5.03b
Cost of RevenueUS$4.20b
Gross ProfitUS$832.19m
Other ExpensesUS$514.19m
EarningsUS$318.00m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)9.18
Gross Margin16.54%
Net Profit Margin6.32%
Debt/Equity Ratio18.7%

How did HUBG perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is HUBG undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HUBG?

Other financial metrics that can be useful for relative valuation.

HUBG key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue0.6x
Enterprise Value/EBITDA5x
PEG Ratio-0.7x

Price to Earnings Ratio vs Peers

How does HUBG's PE Ratio compare to its peers?

HUBG PE Ratio vs Peers
The above table shows the PE ratio for HUBG vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average15.1x
FWRD Forward Air
17.1x3.6%US$2.8b
AAWW Atlas Air Worldwide Holdings
6.1x-13.3%US$2.8b
ATSG Air Transport Services Group
11x4.9%US$2.3b
GXO GXO Logistics
26.4x22.6%US$5.7b
HUBG Hub Group
8.8x-12.6%US$2.8b

Price-To-Earnings vs Peers: HUBG is good value based on its Price-To-Earnings Ratio (8.8x) compared to the peer average (15.1x).


Price to Earnings Ratio vs Industry

How does HUBG's PE Ratio compare vs other companies in the Global Logistics Industry?

Price-To-Earnings vs Industry: HUBG is good value based on its Price-To-Earnings Ratio (8.8x) compared to the US Logistics industry average (11x)


Price to Earnings Ratio vs Fair Ratio

What is HUBG's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HUBG PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio8.8x
Fair PE Ratio8x

Price-To-Earnings vs Fair Ratio: HUBG is expensive based on its Price-To-Earnings Ratio (8.8x) compared to the estimated Fair Price-To-Earnings Ratio (8x).


Share Price vs Fair Value

What is the Fair Price of HUBG when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HUBG ($80.68) is trading below our estimate of fair value ($101.37)

Significantly Below Fair Value: HUBG is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.


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Future Growth

How is Hub Group forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


-12.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HUBG's earnings are forecast to decline over the next 3 years (-12.6% per year).

Earnings vs Market: HUBG's earnings are forecast to decline over the next 3 years (-12.6% per year).

High Growth Earnings: HUBG's earnings are forecast to decline over the next 3 years.

Revenue vs Market: HUBG's revenue (1.9% per year) is forecast to grow slower than the US market (7.9% per year).

High Growth Revenue: HUBG's revenue (1.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HUBG's Return on Equity is forecast to be low in 3 years time (10.8%).


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Past Performance

How has Hub Group performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


17.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: HUBG has high quality earnings.

Growing Profit Margin: HUBG's current net profit margins (6.3%) are higher than last year (2.4%).


Past Earnings Growth Analysis

Earnings Trend: HUBG's earnings have grown by 17.6% per year over the past 5 years.

Accelerating Growth: HUBG's earnings growth over the past year (249.5%) exceeds its 5-year average (17.6% per year).

Earnings vs Industry: HUBG earnings growth over the past year (249.5%) exceeded the Logistics industry 77.7%.


Return on Equity

High ROE: HUBG's Return on Equity (20.7%) is considered high.


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Financial Health

How is Hub Group's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: HUBG's short term assets ($1.1B) exceed its short term liabilities ($718.6M).

Long Term Liabilities: HUBG's short term assets ($1.1B) exceed its long term liabilities ($425.4M).


Debt to Equity History and Analysis

Debt Level: HUBG has more cash than its total debt.

Reducing Debt: HUBG's debt to equity ratio has reduced from 23.9% to 18.7% over the past 5 years.

Debt Coverage: HUBG's debt is well covered by operating cash flow (97.5%).

Interest Coverage: HUBG's interest payments on its debt are well covered by EBIT (65x coverage).


Balance Sheet


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Dividend

What is Hub Group current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate HUBG's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate HUBG's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if HUBG's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if HUBG's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as HUBG has not reported any payouts.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

David Yeager (69 yo)

27.42yrs

Tenure

US$5,724,633

Compensation

Mr. David P. Yeager has been the Chief Executive Officer of Hub Group Inc. since March 1995. Mr. Yeager served as the President of Hub Chicago from October 1985 to December 1991. He served as a Vice Presid...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD5.72M) is about average for companies of similar size in the US market ($USD6.58M).

Compensation vs Earnings: David's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: HUBG's management team is considered experienced (3.3 years average tenure).


Board Members

Experienced Board: HUBG's board of directors are considered experienced (4.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Hub Group, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Hub Group, Inc.
  • Ticker: HUBG
  • Exchange: NasdaqGS
  • Founded: 1971
  • Industry: Air Freight and Logistics
  • Sector: Transportation
  • Implied Market Cap: US$2.796b
  • Shares outstanding: 34.65m
  • Website: https://www.hubgroup.com

Number of Employees


Location

  • Hub Group, Inc.
  • 2000 Clearwater Drive
  • Oak Brook
  • Illinois
  • 60523-8809
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/06 00:00
End of Day Share Price2022/08/05 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.