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Hub Group (HUBG)
NASDAQ:HUBG
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Hub Group
(NASDAQ:HUBG)
63Neutral
Positive Factors
Earnings Growth
New rail agreements, good cost control, network alignment in the Logistics business, and the new JV with EASO should contribute to long term earnings growth.
Intermodal Volume Growth
Hub Group is well positioned for intermodal volume growth given new rail agreements, good cost controls, and solid intermodal service.
Operational Improvement
The company delivered a year-over-year improvement in adjusted operating margin in the fourth quarter and executed a strong peak season for customers, leading to Intermodal volume growth of 14% in the quarter.
Negative Factors
Intermodal Rate Recovery
Intermodal rate recovery is slower than expected, leading to reduced estimates and price target for HUBG.
Pricing Challenges
Shippers are pushing back more on intermodal rate increases than on TL rates, indicating pricing challenges.
Revenue Performance
Total company results showed revenue below estimates driven mostly by lower Logistics revenue than expected.
Hub Group (HUBG) vs. S&P 500 (SPY)
Market Cap
$2.01B
Dividend Yield1.52%
Average Volume (3M)673.71K
Price to Earnings (P/E)19.3
Beta (1Y)1.02
Revenue Growth-6.10%
EPS Growth-34.78%
CountryUS
Employees6,471
SectorIndustrials
Sector Strength79
IndustryIntegrated Freight & Logistics
Share Statistics
EPS (TTM)1.70
Shares Outstanding60,691,372
10 Day Avg. Volume464,712
30 Day Avg. Volume673,709
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.56
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit0.93
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$44.00Price Target Upside33.82% Upside
Rating ConsensusHold
Number of Analyst Covering12
Hub Group Business Overview & Revenue Model
Company DescriptionHub Group, Inc. is a leading supply chain solutions provider, offering a comprehensive range of services to enhance the flow of goods across North America. The company operates in the logistics and transportation sectors, providing intermodal, trucking, logistics, and dedicated transportation services. With a focus on delivering value through technology and innovation, Hub Group serves a diverse customer base across various industries, ensuring efficient and reliable transportation solutions.
How the Company Makes MoneyHub Group generates revenue through its diverse portfolio of logistics and transportation services. The primary revenue streams include intermodal services, which involve the transportation of freight in containers using multiple modes of transportation, such as rail and truck; truck brokerage, where the company arranges the transportation of freight by third-party carriers; and logistics services, which encompass supply chain management, warehousing, and distribution solutions. Additionally, Hub Group offers dedicated trucking services, providing customers with fleets and drivers tailored to their specific needs. Key partnerships with railroads, carriers, and technology providers enhance Hub Group's service offerings and contribute to its earnings by enabling efficient operations and expanded service capabilities.
Hub Group Financial Statement Overview
Summary
Hub Group's financial statements reflect a company with a solid base but facing challenges in revenue growth and profitability margins. The balance sheet remains strong, providing stability, while cash flow management shows room for improvement. Focusing on enhancing revenue streams and operational efficiencies could help improve overall financial health and investor appeal.Income Statement
Hub Group's income statement shows a mixed performance. The gross profit margin has been consistently high, indicating strong cost management, but net profit margin has decreased over recent years. Revenue has declined, particularly from 2022 to 2024, which could indicate challenges in maintaining sales growth. EBIT and EBITDA margins have also shrunk, suggesting a decrease in operational efficiency. Overall, while the company demonstrates profitability, the declining trend in revenue and margins suggests potential areas for improvement.65
Positive
Balance Sheet
The balance sheet of Hub Group reflects a relatively healthy financial position. The debt-to-equity ratio is moderate, showing a cautious approach to leveraging. The equity ratio, indicating financial stability, remains robust. However, the return on equity has declined, which could impact investor confidence. Despite these concerns, the company's equity base is solid, providing a strong foundation for future growth and investment.72
Positive
Cash Flow
Hub Group's cash flow statement reveals mixed signals. Operating cash flow remains strong, indicative of good core business performance. However, free cash flow has seen fluctuations, with a notable decrease from 2023 to 2024. The free cash flow to net income ratio suggests variability in converting income into cash. These cash flow dynamics highlight the need for effective cash management strategies to ensure liquidity and support investment opportunities.68
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 3.95B | 4.20B | 5.34B | 4.23B | 3.50B | Gross Profit |
| 3.37B | 503.66M | 889.50M | 599.64M | 425.44M | EBIT |
| 140.29M | 212.23M | 474.72M | 238.46M | 105.83M | EBITDA |
| 266.39M | 391.86M | 610.14M | 349.91M | 230.50M | Net Income Common Stockholders |
| 103.99M | 167.53M | 356.95M | 171.47M | 73.56M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 98.25M | 187.27M | 286.64M | 159.78M | 124.51M | Total Assets |
| 2.87B | 2.94B | 2.81B | 2.44B | 2.11B | Total Debt |
| 508.51M | 575.51M | 451.74M | 322.28M | 318.58M | Net Debt |
| 410.26M | 388.25M | 165.10M | 162.50M | 194.07M | Total Liabilities |
| 1.18B | 1.30B | 1.21B | 1.10B | 947.47M | Stockholders Equity |
| 1.64B | 1.63B | 1.60B | 1.34B | 1.16B |
| Cash Flow | Free Cash Flow | |||
| 143.57M | 282.09M | 239.02M | 119.88M | 59.65M | Operating Cash Flow |
| 194.42M | 422.16M | 458.16M | 252.84M | 174.95M | Investing Cash Flow |
| -53.33M | -373.16M | -278.87M | -210.13M | -196.86M | Financing Cash Flow |
| -201.33M | -148.41M | -52.46M | -7.41M | -22.30M |
Hub Group Technical Analysis
Neutral
32.88
Price Trends
36.13
Negative
40.50
Negative
42.85
Negative
Market Momentum
-1.18
Negative
45.06
Neutral
38.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HUBG, the sentiment is Neutral. The current price of 32.88 is above the 20-day moving average (MA) of 32.65, below the 50-day MA of 36.13, and below the 200-day MA of 42.85, indicating a neutral trend. The MACD of -1.18 indicates Negative momentum. The RSI at 45.06 is Neutral, neither overbought nor oversold. The STOCH value of 38.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HUBG.
Hub Group Risk Analysis
Hub Group disclosed 25 risk factors in its most recent earnings report. Hub Group reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Hub Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $10.74B | 23.54 | 32.11% | 2.72% | -0.22% | 65.52% | |
68 Neutral | $4.39B | 33.62 | 4.53% | ― | 19.75% | -41.77% | |
64 Neutral | $13.29B | 23.92 | 13.97% | 1.29% | -3.82% | -12.80% | |
64 Neutral | $4.28B | 11.80 | 5.33% | 250.46% | 4.10% | -9.26% | |
63 Neutral | $2.01B | 19.32 | 6.34% | 1.52% | -6.10% | -34.78% | |
63 Neutral | $4.77B | 24.75 | 20.03% | 1.03% | -9.13% | -25.11% | |
45 Neutral | $538.85M | ― | -167.82% | 0.86% | 56.49% | -7872.87% |
* Industrials Sector Average
Performance Comparison
HUBG
Hub Group
32.88
-9.56
-22.53%
CHRW
CH Robinson
90.83
14.04
18.28%
FWRD
Forward Air
17.72
-3.04
-14.64%
JBHT
JB Hunt
133.57
-31.32
-18.99%
LSTR
Landstar System
136.47
-41.37
-23.26%
GXO
GXO Logistics
37.52
-13.91
-27.05%
Hub Group Earnings Call Summary
Earnings Call Date:Feb 06, 2025
(Q4-2024)
| % Change Since: -23.78%|
Next Earnings Date:May 08, 2025
Earnings Call Sentiment Neutral
The earnings call reveals a mixed performance for Hub Group in the fourth quarter of 2024. While there were significant achievements in operating margin improvement, intermodal volume growth, and shareholder returns, the company also faced challenges with revenue decline, decreased revenue per load, and difficulties in the brokerage segment.Q4-2024 Updates
Positive Updates
Intermodal Volume Growth
Intermodal volumes increased 14% year-over-year in the fourth quarter, with local leads up 25% and significant growth in Mexico.
Operating Margin Improvement
The company delivered a 50 basis point improvement in year-over-year operating margin, achieving a 3.9% adjusted operating income margin for the quarter.
Shareholder Returns
Returned nearly $100 million to shareholders through share repurchases and dividends in 2024.
Dedicated Segment Performance
Dedicated segment saw year-over-year earnings growth, with a 13% increase in revenue per truck per day.
Logistics Segment Margin Improvement
Logistics segment delivered a 20 basis point improvement in year-over-year operating margins.
EBITDA Less CapEx Growth
EBITDA less CapEx increased by 16% over the previous year, demonstrating strong cash resiliency.
Negative Updates
Revenue Decline
Hub Group reported a 6% decline in revenue for the full year and a 1% decline for the fourth quarter compared to the previous year.
Decreased Revenue Per Load
Revenue per load declined 9% year-over-year due to mixed fuel and pricing headwinds.
Brokerage Segment Challenges
Brokerage load count declined by 6% with revenue per load down 12%, partially due to a loose spot market.
Impact of Lower Fuel Revenue
Lower fuel revenue of approximately $22 million negatively impacted full-year ICS revenues.
Company Guidance
During the Hub Group's fourth quarter 2024 earnings call, guidance for 2025 was provided, focusing on revenue and earnings improvements. The company expects revenue between $4 billion and $4.3 billion, with EPS ranging from $1.90 to $2.40. Key performance indicators highlighted include intermodal volume growth anticipated at high single digits, with a low single-digit price increase. The fourth quarter saw a 50 basis point improvement in operating margins year-over-year, intermodal volumes increased by 14%, and local leads rose by 25%. Revenue per load declined 9% year-over-year but improved 4% sequentially. The company aims to enhance its cost structure, reducing cost per day by 3% and improving container utilization by 6%. Hub Group also reported a 13% increase in revenue per truck per day in its Dedicated segment, while logistics operating margins improved by 20 basis points year-over-year. Shareholder returns included nearly $100 million from share repurchases and dividends.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.