Corporate executives and directors tend to have superior information in relation to their firms’ operating activities. If these insiders are buying company stock, it’s generally a bullish signal.
Here, we are going to look at recent insider buying at Hub Group Inc (HUBG:US). Hub Group provides its clients with supply chain solutions across North America. The company is split into two divisions – Transportation Solutions and Logistics Management. It’s traded on the Nasdaq Stock Exchange and currently has a market capitalization of $2.95 billion.
Insider buying at Hub Group
Our insider transaction data shows that on August 11, Gary Yablon, a director at Hub Group, bought 5,000 HUBG shares at a price of $85.60 per share. This trade cost the insider $428,000 and increased his stake by around 150%.
Hall of fame investor
We believe this insider trading at Hub Group is interesting for two reasons.
Firstly, Mr. Yablon is a highly respected investor within the transport and logistics sector. He has been a Managing Partner at Impala Asset Management since its inception in 2004 where his focus is on global transportation/industrials and logistics. Before this, he was head of freight transportation and logistics equity research at Credit Suisse First Boston. In 2010 he was inducted into the Institutional Investor Hall of Fame.
Secondly, the insider has spent nearly $430,000 on Hub Group shares and increased his holding by a sizable percentage. This suggests that he is very confident that the market is undervaluing the shares right now.
Hub Group produced a strong set of Q2 figures with record quarterly revenue feeding through to a record quarterly EPS figure.
For the period, revenue was $1.4 billion, 43% higher than Q2 2021, boosted by strong freight demand conditions. Favorable pricing and yield management meant that the gross margin of $247 million was a record quarterly number, as was the diluted EPS figure of $3.03.
Looking ahead, the group increased its outlook for 2022. It now expects revenue for the full year to be in the range of $5.6 billion to $5.7 billion, and diluted EPS is expected to come in between $10 and $10.50.
“Our team continues to perform at a high level in today’s environment, delivering record revenue and profit,” said Dave Yeager, Hub Group’s CEO and Chairman. “We expect a strong finish to 2022,” he added.
On the back of these strong Q2 figures, we see the insider buying here as a bullish development.