Financial Analysis: Hub Group (NASDAQ:HUBG) vs. Firstgroup (OTCMKTS:FGROY)

Hub Group (NASDAQ:HUBG) and Firstgroup (OTCMKTS:FGROY) are both transportation companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, risk, earnings, valuation, analyst recommendations, dividends and institutional ownership.

Risk and Volatility

Hub Group has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500. Comparatively, Firstgroup has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500.

Insider & Institutional Ownership

46.8% of Hub Group shares are held by institutional investors. 3.5% of Hub Group shares are held by company insiders. Comparatively, 0.2% of Firstgroup shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Hub Group and Firstgroup”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hub Group	$3.95 billion	0.66	$103.99 million	$1.73	24.66
Firstgroup	$6.46 billion	0.22	$162.68 million	N/A	N/A

Firstgroup has higher revenue and earnings than Hub Group.

Dividends

Hub Group pays an annual dividend of $0.50 per share and has a dividend yield of 1.2%. Firstgroup pays an annual dividend of $0.05 per share and has a dividend yield of 2.0%. Hub Group pays out 28.9% of its earnings in the form of a dividend.

Profitability

This table compares Hub Group and Firstgroup’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hub Group	2.82%	6.58%	3.97%
Firstgroup	N/A	N/A	N/A

Analyst Recommendations

This is a summary of current recommendations and price targets for Hub Group and Firstgroup, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hub Group	1	9	7	0	2.35
Firstgroup	0	0	1	0	3.00

Hub Group currently has a consensus target price of $43.20, suggesting a potential upside of 1.27%. Given Hub Group’s higher possible upside, equities analysts plainly believe Hub Group is more favorable than Firstgroup.

Summary

Hub Group beats Firstgroup on 9 of the 14 factors compared between the two stocks.

About Hub Group

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 2,300 tractors, 460 independent owner-operators, and 4,300 trailers to its customers, as well as the management and infrastructure. The company serves a range of industries, including retail, consumer products, and durable goods. As of December 31, 2023, it owned approximately 50,000 dry, 53-foot containers, as well as 900 refrigerated and 53-foot containers. The company was founded in 1971 and is headquartered in Oak Brook, Illinois.

About Firstgroup

FirstGroup plc provides public transport services in the United Kingdom. The company operates through First Bus and First Rail segments. The First Bus segment offers local bus services with a fleet of approximately 4,800 buses in the United Kingdom. The First Rail segment operates a passenger rail network that provides long-distance, commuter, regional, and sleeper services through a portfolio of Great Western Railway, South Western Railway, and Avanti West Coast franchises; and hull trains and Lumos. FirstGroup plc was founded in 1986 and is based in London, the United Kingdom.