Yahoo Finance Hub Group, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Hub Group, Inc. (NASDAQ:HUBG) last week reported its latest first-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$999m, statutory earnings beat expectations by a notable 11%, coming in at US$0.44 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Check out our latest analysis for Hub Group
Taking into account the latest results, the consensus forecast from Hub Group's twelve analysts is for revenues of US$4.49b in 2024. This reflects a notable 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to decrease 3.6% to US$2.05 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.58b and earnings per share (EPS) of US$2.15 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.
The analysts made no major changes to their price target of US$45.20, suggesting the downgrades are not expected to have a long-term impact on Hub Group's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Hub Group analyst has a price target of US$50.00 per share, while the most pessimistic values it at US$40.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
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. It's clear from the latest estimates that Hub Group's rate of growth is expected to accelerate meaningfully, with the forecast 15% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.1% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Hub Group is expected to grow much faster than its 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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Hub Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Hub Group analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Hub Group that you need to take into consideration.
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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.
