Hub Group President and CEO Phil Yeager is optimistic the company could get an acquisition completed in the short-term, he said during an earnings call Thursday.
Yeager did not say an announcement was imminent but he noted M&A has always been part of the company’s growth strategy, particularly in non-asset-based acquisitions to build out its logistics segment.
“I think we all feel good about our acquisition pipeline and we’re optimistic to get an acquisition completed in the short-term here,” Yeager said during the call.
Its Q3 earnings revealed progress on increasingly diversifying into logistics. In the company’s logistics segment, operating income was $29 million, accounting for 6.3% of revenue, up 5.9% from last year.
Despite weak freight conditions, the company reported brokerage volumes increased 5% year-over-year.
Hub Group has focused on growing its logistics capabilities in recent years. In December 2020, it acquired last-mile service provider NonstopDelivery and followed that up by purchasing 3PL specialist Choptank Transport in October 2021.
In August 2022, Hub Group acquired TAGG Logistics, a provider of warehouse and fulfillment services.
M&A remains an active part of the company’s capital strategy, TD Cowen analysts wrote in a research note Friday.
“Management has publicly stated it is looking to make a $150 [million]-$350 million acquisition each year for the next several years,” the analysts noted.
