Baird has downgraded Hub Group (NASDAQ:HUBG) from Outperform to Neutral and lowered its price target to $29.00 from $47.00 following the logistics company’s acknowledgment of an accounting error. The revised target sits well below the stock’s last quoted level of $51.33, which traded at a price-to-earnings ratio of 29.92.
Hub Group said after market close that it found an error that resulted in the understatement of purchased transportation costs and accounts payable during the first nine months of 2025. The company reported that the total understatement in accounts payable and purchased transportation costs recorded during those periods amounted to $77 million.
While the company confirmed the correction will increase purchased transportation and warehousing costs and accounts payable for the nine months ended September 30, 2025, it said it cannot yet determine the precise magnitude of the increase. The uncertainty has prompted Baird analyst Dan Moore to indicate that financial results for the first three quarters of 2025 are expected to be restated.
Separately, Hub Group reported a 7% year-over-year decline in consolidated operating revenue for the fourth quarter of 2025, totaling $3.7 billion. Management has delayed release of its full, audited earnings because of a material misstatement in historical earnings that must be addressed prior to finalizing the audited financial statements.
The accounting disclosure and delayed audited filing have already prompted action from other brokerages. Stifel downgraded the stock from Buy to Sell and reduced its price target from $52.00 to $27.00, citing the recently disclosed accounting issues as the primary driver behind the change in stance and the increased investor concern.
Hub Group said it remains focused on investments in technology and steps to improve operational efficiency despite the revenue decline and the financial reporting disruption. The company’s acknowledgment of the error and the resulting corrective work will require restatements and closer scrutiny of its cost recognition for purchased transportation and warehousing services.
Implications
The combination of an identified accounting error, a likely restatement of quarterly results and broker downgrades has added uncertainty around Hub Group’s near-term financial picture. Market valuation reflects that uncertainty through lower analyst price targets and negative rating actions. The developments affect stakeholders across the logistics sector, capital markets and corporate governance observers tracking the accuracy of reported costs and liabilities.