Hub Group is a leading asset-light freight transportation management company providing intermodal, truck brokerage and logistics services. The company was founded in 1971 and is based in Oak Brook, Illinois.
HUBG Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Hub Group Inc. To summarize, we found that Hub Group Inc ranked in the 77th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 354.5%. In terms of the factors that were most noteworthy in this DCF analysis for HUBG, they are:
The compound growth rate in the free cash flow of Hub Group Inc over the past 5.03 years is 0.4%; that's better than 84.82% of cash flow producing equities in the Industrials sector, where it is classified.
Hub Group Inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 24.13% of tickers in our DCF set.
HUBG's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than only 24.13% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as HUBG, try IIIN, HCCI, TPC, MLHR, and BGSF.
Intermodal volumes could start to improve around the fourth quarter of 2020 or the first quarter of 2021, but uncertainty surrounding the coronavirus pandemic makes any volume forecast dicey, said a trio of panelists at Wolfe Research's Global Transportation and Industrials conference on Tuesday. "You have some really big factors that aren't normal items," and it's not just an economic issue but a biological one, said Jim Filter, Schneider National (NYSE: SNDR ) senior vice president and general manager of intermodal. Filter was part of the panel, along with Phil Yeager, president and CEO of the Hub Group (NASDAQ: HUBG ), and Darren Field, president of intermodal of J.B. Hunt Transport Services (NASDAQ: JBHT ). Forecasting intermodal demand is challenging under existing conditions; in t...
Trucking stocks are falling at a rate generally in line with the broader decline in equities, with few companies sticking out as being particularly strong or weak. A quick look at some of the biggest names in the market shows that Heartland (NASDAQ: HTLD ) has performed better than other stocks among a selected group of key names, dropping 19.92% in the last month, according to data on Barchart. Meanwhile, Hub Group (NASDAQ: HUBG ), an intermodal carrier, is down 31.87% during that time. Since February 1, the S&P 500 is down a little less than 25%. Saia (NASDAQ: SAIA ) also has taken a big hit and that's not surprising; the less-than-truckload (LTL) carrier is viewed as being particularly exposed to industrial demand – particularly in the oil and gas sector. It's down 32.16% in the past...
Intermodal carrier Hub Group (NASDAQ: HUBG ) posted fourth-quarter 2019 earnings in line with the consensus forecast of $0.82-$0.85 per share, on a revenue decline of 11.5%. The company posted $0.85 per share in basic earnings and $0.84 per share in diluted earnings. For the company as a whole, total revenue dropped to $900.68 million from $1.018 billion in the fourth quarter of 2018. Operating income was down to $27.95 million from $33.67 million, a drop of 19.5%. Full-year basic earnings of $6.04 per share, including discontinued operations, were a record, company officials said on their earnings call with analysts. The drop in revenue and earnings did not prevent the company from actually increasing its gross margin as a percent of revenue to 14% from 13.6% "due to our success in pro...