Sterne Agee Maintains Rating, PT On HUBG In Light Of Acquisition

Sterne Agee is maintaining its Buy rating and its price target of $42 on Hub Group Inc HUBG, claiming that the company's acquisition of Mode Transportation could be more lucrative than being let on. In the report, Sterne Agee writes, “We view the acquisition as a positive given the benefits from increasing scale, entry into a higher margin market, synergies from improved purchased transportation costs and addressing the capacity constraints that impaired Mode's margins in 2010. If management is able to execute on synergies, this could be the best $83 million HUBG has spent.” HUBG closed Friday at $37.51.