Why Hub Group's Shares Dropped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Hub Group (Nasdaq: HUBG  ) fell 10% today after the company released earnings.

So what: In the second quarter revenue increased less than 4% to $778.3 million, but net income rose 18% to $16.9 million, or $0.46. The results were lower than expected and the company also cut its earnings forecast.

Now what: Management now expects earnings per share to be $1.80-$1.90 for the full-year, about 10% lower than the previous forecast. With that, shares are trading at over 15 times 2012 earnings estimates, a fairly high price for a company that isn't growing much at all. I'll leave the move alone and wait for either better value, or for earnings to pick up, before buying shares.

Interested in more info on Hub Group? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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