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1. Company Snapshot

1.a. Company Description

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.


The company also provides dry van, expedited, less-than-truckload, refrigerated, and flatbed truck brokerage services.It offers a fleet of approximately 1,000 tractors and 4,600 trailers to its customers, as well as the driver staffing, management, and infrastructure.The company serves a range of industries, including retail, consumer products, and durable goods.


As of December 31, 2021, it owned approximately 43,750 dry, 53-foot containers, as well as 450 refrigerated, 53-foot containers; and leased approximately 250 dry, 53-foot containers.The company was founded in 1971 and is headquartered in Oak Brook, Illinois.

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1.b. Last Insights on HUBG

Hub Group, Inc.'s recent performance was positively driven by several factors. The company's Q3 2025 earnings matched estimates, with GAAP diluted EPS of $0.47 and revenue of $934 million. Strategic acquisitions, including Marten Transport Intermodal assets and SITH, LLC, expanded its capabilities. Additionally, Envestnet Asset Management Inc. increased its holdings by 3.4%, and the company declared a quarterly dividend of $0.125 per share. These developments showcase the company's growth and commitment to shareholder value.

1.c. Company Highlights

2. Hub Group's Q3 2025 Earnings: A Closer Look

Hub Group reported revenue of $934 million for the third quarter of 2025, a 5% decrease compared to the same period last year. Adjusted operating income decreased 4% year-over-year, but adjusted operating income margin improved 10 basis points to 4.4%. Adjusted EBITDA was $88 million, and adjusted EPS was $0.49, in line with estimates. The company's ITS revenue was $561 million, slightly greater than the prior year, driven by steady intermodal volume and 2% growth in revenue per load.

Publication Date: Nov -02

📋 Highlights
  • 3Q 2025 Revenue Decline:: Reported revenue fell 5% to $934M, with Logistics segment revenue dropping 13% YoY due to lower volume and revenue per load.
  • Adjusted Operating Margins Improve:: Adjusted operating income margin rose 10bps to 4.4%, driven by cost containment and improved performance in Final Mile and managed transportation.
  • Intermodal Growth Momentum:: ITS revenue reached $561M (+1% YoY) with 2% revenue-per-load growth, supported by 6 consecutive quarters of intermodal volume gains.
  • Free Cash Flow and Stock Buybacks:: Generated >$150M in free cash flow 2025 and repurchased $30M of stock, reflecting strong balance sheet leverage (net debt: $136M).
  • 2026 Bid Season Outlook:: Anticipates favorable conditions due to Transcontinental Rail merger timing, with 48% of bids effective Q1 2026, and expects margin upside from capacity constraints.

Segment Performance

The Logistics segment revenue declined 13% year-over-year due to lower volume and revenue per load in brokerage. However, operating margins improved 10 basis points as cost containment initiatives and performance in Final Mile and managed transportation helped offset headwinds. The company's intermodal business continues to show strength, with 6 consecutive quarters of growth and a business day difference between August and September that canceled each other out.

Outlook and Guidance

The company expects full-year EPS in the range of $1.80 to $1.90 and revenue of $3.6 billion to $3.7 billion. They project an effective tax rate of approximately 24.5% and capital expenditures of less than $50 million for the year. Analysts estimate next year's revenue growth at 3.5%, indicating a potential upside.

Valuation and Return Metrics

With a P/E Ratio of 21.07, P/B Ratio of 1.3, and EV/EBITDA of 9.41, the company's valuation metrics suggest a relatively stable stock. Additionally, the company's ROIC of 4.39% and ROE of 6.29% indicate a decent return on investment. The Net Debt / EBITDA ratio of 1.36 suggests a manageable debt level. Phillip Yeager's comment, "we're excited about the potential for growth, particularly with the Marten acquisition, which is expected to be slightly accretive this quarter," reinforces the positive outlook.

Growth Prospects

The company is well-positioned for the upcoming bid season, with over 80% of their intermodal network up for bid. The potential Transcontinental Rail merger is expected to create a positive framework for 2026 bid season. The company's investments in intermodal business and its prospects for growth, particularly in the Marten acquisition, are expected to drive improvement in the fourth quarter and beyond.

3. NewsRoom

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Meta Combines Facebook and Instagram Support Into a Single Hub

Dec -05

Source: cnet.com

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Capital Fund Management S.A. Grows Position in Hub Group, Inc. $HUBG

Dec -04

Source: defenseworld.net

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Cribl Supercharges Incident Response in Amazon Security Hub with Open Cybersecurity Schema Framework (OCSF) Support

Dec -02

Source: globenewswire.com

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Varonis Announces Integration With AWS Security Hub

Dec -02

Source: globenewswire.com

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The Verification Race Every Trading Hub Must Now Enter; SMX is the Starter

Dec -02

Source: accessnewswire.com

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Homerun Resources Inc. Announces Engagement of Jiri Skopek as Corporate Development Advisor for the Strategic Commercialization of the Enduring Long Duration Energy Storage System Integrated with "The Hub" AI Energy Management Platform

Dec -02

Source: newsfilecorp.com

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Homerun Resources Inc. Announces First Commercial Installation of "The Hub" AI Energy Management System on a Risen Battery Storage Asset

Nov -26

Source: newsfilecorp.com

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Hub Group Declares Quarterly Dividend

Nov -21

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.92%)

6. Segments

Intermodal and Transportation Solutions

Expected Growth: 10%

Hub Group's 10% growth in Intermodal and Transportation Solutions is driven by increasing demand for efficient logistics, rising e-commerce sales, and growing need for supply chain visibility. Additionally, investments in digitalization, expansion of services, and strategic partnerships contribute to the segment's growth.

Logistics

Expected Growth: 8%

Hub Group's 8% logistics growth driven by increasing e-commerce demand, strategic acquisitions, and expansion of intermodal services. Additionally, investments in digitalization and process automation have improved operational efficiency, further boosting growth. Strong relationships with major retailers and a diverse customer base have also contributed to the company's growth momentum.

Intersegment Eliminations

Expected Growth: 0%

Hub Group's Intersegment Eliminations with 0% growth is attributed to the absence of significant transactions between its business segments, including Hub Group Trucking, Hub Group Dedicated, and Hub Group Logistics. This lack of intersegment activity is due to the company's focus on providing standalone logistics services, resulting in minimal eliminations.

7. Detailed Products

Intermodal

Hub Group's intermodal service provides door-to-door transportation of goods in containers that can be moved seamlessly between ships, trains, and trucks.

Truck Brokerage

Hub Group's truck brokerage service connects shippers with a network of qualified carriers to move goods by truck.

Dedicated

Hub Group's dedicated service provides customized transportation solutions for shippers who require a dedicated fleet of trucks and drivers.

Warehouse and Distribution

Hub Group's warehouse and distribution services provide storage, inventory management, and order fulfillment solutions for shippers.

Final Mile

Hub Group's final mile service provides delivery of goods from a hub or warehouse to a customer's doorstep.

Supply Chain Solutions

Hub Group's supply chain solutions provide customized logistics and transportation management services for shippers.

8. Hub Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Hub Group, Inc. operates in a highly competitive industry, and there are many substitutes available for its services. However, the company's strong brand reputation and extensive network of transportation services help to mitigate the threat of substitutes.

Bargaining Power Of Customers

Hub Group, Inc. has a large and diverse customer base, but some of its major customers have significant bargaining power due to their large volumes and long-term contracts. This gives them the ability to negotiate better prices and terms.

Bargaining Power Of Suppliers

Hub Group, Inc. has a diverse supplier base, and no single supplier has significant bargaining power. The company's large scale of operations and long-term contracts with suppliers also help to reduce the bargaining power of suppliers.

Threat Of New Entrants

The threat of new entrants in the logistics and transportation industry is low due to the high barriers to entry, including significant capital requirements and regulatory hurdles. Hub Group, Inc.'s established brand and extensive network of services also make it difficult for new entrants to compete.

Intensity Of Rivalry

The logistics and transportation industry is highly competitive, with many established players competing for market share. Hub Group, Inc. faces intense competition from other major logistics companies, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 19.54%
Debt Cost 3.95%
Equity Weight 80.46%
Equity Cost 8.46%
WACC 7.58%
Leverage 24.28%

11. Quality Control: Hub Group, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Mueller Industries

A-Score: 6.3/10

Value: 4.5

Growth: 7.1

Quality: 7.9

Yield: 2.0

Momentum: 8.5

Volatility: 8.0

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Expeditors International of Washington

A-Score: 5.3/10

Value: 3.6

Growth: 5.0

Quality: 7.1

Yield: 2.0

Momentum: 5.0

Volatility: 9.0

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Hub Group

A-Score: 4.2/10

Value: 6.0

Growth: 4.0

Quality: 6.1

Yield: 1.0

Momentum: 2.0

Volatility: 6.3

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J.B. Hunt Transport Services

A-Score: 3.9/10

Value: 3.7

Growth: 5.0

Quality: 5.4

Yield: 2.0

Momentum: 2.0

Volatility: 5.3

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XPO Logistics

A-Score: 3.5/10

Value: 2.0

Growth: 4.8

Quality: 3.9

Yield: 0.0

Momentum: 6.0

Volatility: 4.3

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GXO Logistics

A-Score: 3.4/10

Value: 3.1

Growth: 6.0

Quality: 2.2

Yield: 0.0

Momentum: 3.5

Volatility: 5.7

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

41.28$

Current Price

41.28$

Potential

-0.00%

Expected Cash-Flows