Is Hub Group (HUBG) Stock Undervalued Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company to watch right now is Hub Group (HUBG). HUBG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 8.34, while its industry has an average P/E of 10.62. Over the last 12 months, HUBG's Forward P/E has been as high as 21.60 and as low as 7.84, with a median of 16.45.
Another valuation metric that we should highlight is HUBG's P/B ratio of 1.70. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 3.14. HUBG's P/B has been as high as 2.40 and as low as 1.49, with a median of 1.97, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. HUBG has a P/S ratio of 0.55. This compares to its industry's average P/S of 0.76.
Finally, investors will want to recognize that HUBG has a P/CF ratio of 6.33. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.27. HUBG's P/CF has been as high as 12.39 and as low as 5.55, with a median of 9.31, all within the past year.
Investors could also keep in mind Universal Logistics (ULH), an Transportation - Services stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Universal Logistics sports a P/B ratio of 2.02 as well; this compares to its industry's price-to-book ratio of 3.14. In the past 52 weeks, ULH's P/B has been as high as 2.46, as low as 1.43, with a median of 1.90.
Value investors will likely look at more than just these metrics, but the above data helps show that Hub Group and Universal Logistics are likely undervalued currently. And when considering the strength of its earnings outlook, HUBG and ULH sticks out as one of the market's strongest value stocks.
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Hub Group, Inc. (HUBG) : Free Stock Analysis Report
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