Phillip Yeager
Hub GroupAbout Phillip Yeager
Phillip D. Yeager, 38, is President, Chief Executive Officer and Vice Chairman of Hub Group, serving as CEO since January 1, 2023 and Vice Chairman since February 2024; he joined Hub Group in 2011 after roles at BMO Harris and Lazard and holds a BA from Trinity College and an MBA from the University of Chicago Booth School of Business . 2024 performance context: total shareholder return (TSR) value of $173.72 vs peer index $171.24; net income $103,993k; EBITDA as a percent of gross margin 63.8%—all measures the company uses in its “pay vs performance” disclosures . The 2022–2024 performance share cycle paid out at 200% (metric: EBITDA as % of gross margin), signaling strong execution against internal profitability targets for that period .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Hub Group | President & CEO; Vice Chairman | CEO since 1/1/2023; Vice Chairman since 2/2024 | Continuity of founder-family leadership; strategy and operations oversight |
| Hub Group | President & COO | 7/2019–12/2022 | Ran operations, positioned for CEO succession |
| Hub Group | Chief Commercial Officer | 1/2018–7/2019 | Oversaw intermodal and brokerage, sales, pricing, solutions, account management |
| Hub Group | EVP, Account Mgmt & Intermodal Ops | 1/2016–1/2018 | Scaled core intermodal operations |
| Hub Group | VP, Account Mgmt & Biz Dev | 2/2014–1/2016 | Built customer and growth pipeline |
| Hub Group | Director, Strategy & Acquisitions | 2011–2/2014 | M&A/strategy support at corporate level |
External Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| BMO Harris Bank | Assistant Vice President, Commercial Banking | Not disclosed (prior to 2011) | Credit and client coverage experience |
| Lazard Frères & Co. | Investment Banking Analyst | Not disclosed (prior to 2011) | Transactional/analytical foundation |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 632,500 | 750,000 | 850,000 |
| Perquisites & Other ($) | 134,458 | 96,663 | 161,608 (incl. $10,350 401k match, $223 life insurance, $17,000 DCP match, $134,035 personal aircraft usage) |
Notes
- No employment agreements; executives are at-will .
- Tax gross-ups are not provided (other than for annual physicals if taken) .
Performance Compensation
| Annual Cash Incentive (ACI) | 2024 Design | 2024 Target | 2024 Actual |
|---|---|---|---|
| Metric & Weight | Diluted EPS (100% for CEO) | 125% of base salary = $1,062,500 | $552,500 paid (52% of target) |
| EPS Threshold/Target/Max | ~$1.68 / ~$2.13 / ~$2.58 | — | — |
| 2024 Actual EPS & Payout | Adjusted EPS $1.91; payout 52% | — | — |
Long-Term Incentive (LTI) Structure
- Mix: 50% time-based restricted stock (RSAs) vesting ratably over 5 years; 50% performance-based restricted stock (PSUs) vesting after 3 years based on EBITDA as % of gross margin; 2024 awards granted January 2, 2024 .
- 2024 CEO grants: 26,308 RSAs ($1,200,171 grant date fair value) and 26,308 target PSUs (max 52,616; $1,200,171 grant date fair value) .
- 2022 PSU performance grid (payout vs EBITDA as % of gross margin) and result for 2022–2024 cycle:
| EBITDA as % of Gross Margin | Payout Level |
|---|---|
| 45.0% or less | 0% |
| 46.0% | 20% |
| 47.0% | 40% |
| 48.0% | 60% |
| 49.0% | 80% |
| 50.0% | 100% |
| 51.2% | 120% |
| 52.4% | 140% |
| 53.6% | 160% |
| 54.8% | 180% |
| 56.0% | 200% |
- Outcome: Company exceeded 56%; 200% payout. CEO earned 37,988 shares; vested/payed out January 2, 2025 .
Equity Ownership & Alignment
Beneficial Ownership (as of 3/17/2025)
| Holder | Class A Shares | % Class A | Class B Shares | % Class B |
|---|---|---|---|---|
| Phillip D. Yeager | 426,420 | <1% | 251,494 | 38.8% |
Outstanding Awards (as of 12/31/2024; closing price $44.56)
- Unvested time-based shares (CEO): 26,308 (2024 grant, $1,172,284); 17,738 (2023, $790,405); 11,394 (2022, $507,717); 8,000 (2021, $356,480); 3,200 (2020, $142,592) .
- Unearned PSUs (CEO): 46,302 (2024 PSU, $2,063,221; assumes 176% based on performance to date), 44,348 (2023 PSU, $1,976,147; assumes 200%), 37,988 (2022 PSU, $1,692,745; paid at 200% on Jan 2, 2025) .
Alignment Policies and Constraints
- CEO ownership guideline: ≥3x base salary; five years to comply; all NEOs in compliance as of 12/31/2024 .
- Hedging and pledging: prohibited for directors and executive officers .
- Director/Executive retention: must retain a minimum of 25% of stock granted until ownership guideline met .
- No stock options outstanding; equity delivered as restricted stock (time/performance-based) .
Insider Selling Pressure Considerations
- Annual RSA vesting occurs on January 2 each year; PSU tranches vest on 3rd anniversary (e.g., 2023 PSUs vest 1/2/2026; 2024 PSUs vest 1/2/2027), which can create periodic supply; retention rules and ownership targets reduce net sellable volume .
- Significant PSU vesting occurred on 1/2/2025 at 200% (37,988 shares) .
Employment Terms
- Employment status: at-will; no employment agreements .
- Severance/COC economics: no cash severance on termination; time-based RSAs vest on change in control, death or disability; PSUs vest at greater of target or actual upon change in control or death/disability (2022 plan); DCP company match also vests upon change in control or death/disability .
- CEO’s indicative COC/death/disability equity acceleration value (12/31/2024): $8,701,591 equity + $43,231 deferred comp = $8,744,822 .
- Clawback: SEC/Nasdaq-compliant recoupment policy for unearned performance-based compensation following a financial restatement; discretionary recoupment possible based on culpability .
- Non-compete/Non-solicit: DCP match is forfeitable if participant leaves and works for a competitor (economic deterrent) .
Board Governance
- Role: Director since 1/1/2023; Vice Chairman since 2/2024; not a member of Board committees .
- Independence: Not independent; company is a “controlled company” (Yeager family controls ~61.7% of voting power via all Class B shares); despite this, Board retains a substantial majority of independent directors and fully independent Audit, Compensation, and Nominating & Governance Committees; Lead Independent Director in place (Peter McNitt) .
- Board attendance (2024): Board met 5x; each director attended ≥75% of meetings; independent sessions held regularly .
- Director compensation: CEO is not separately compensated for Board service .
Compensation Structure Analysis
- Cash vs equity mix: 2024 total comp $3.96M with equity $2.40M (heavier equity tilt), base salary increased to $850k (+13.3% YoY) .
- Annual incentive rigor: EPS-only for CEO with 2024 thresholds (~$1.68/$2.13/$2.58); actual $1.91 led to 52% payout—strong downward sensitivity when EPS misses .
- LTI risk profile: 50% performance-based tied to EBITDA as % of gross margin; prior cycle paid 200% (high realized value) .
- Governance safeguards: No options repricing without stockholder approval; hedging/pledging prohibited; no employment agreements or gross-up practices (other than physicals) .
Compensation & Ownership Details
Summary Compensation (CEO)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | 632,500 | 750,000 | 850,000 |
| Stock Awards ($) | 1,600,000 | 1,762,611 | 2,400,342 |
| Non-Equity Incentive ($) | 1,265,000 | — | 552,500 |
| All Other Compensation ($) | 134,458 | 96,663 | 161,608 |
| Total ($) | 3,631,958 | 2,609,274 | 3,964,450 |
Deferred Compensation (2024)
| Item | Amount |
|---|---|
| CEO contributions | $34,000 |
| Company match | $17,000 |
| Aggregate earnings | $109,200 |
| Ending balance | $723,083 |
Performance & Track Record
- Pay vs performance snapshot (2024): Company TSR $173.72; Peer TSR $171.24; Net income $103,993k; EBITDA as % of gross margin 63.8% .
- Incentive outcomes: 2024 ACI paid 52% on EPS miss; 2022–2024 PSUs paid 200% on EBITDA margin performance, with 37,988 shares to CEO .
- Say-on-pay: 2024 vote ≥98% approval on NEO pay .
Compensation Committee & Peer Group
- Compensation Committee: fully independent directors; uses Aon as independent consultant .
- 2024 compensation peer group includes: ArcBest, Forward Air, GXO Logistics, J.B. Hunt, Knight-Swift, Landstar, Old Dominion, Ryder, RXO, Saia, Schneider, Werner .
Related-Party/Control Considerations
- Controlled company: Yeager family holds all Class B shares and ~61.7% voting power; DPY Stockholders’ Agreement centralizes voting, with David P. Yeager able to direct Class B Agreement Shares .
- Related persons: Matthew Yeager (EVP, Procurement) compensation reviewed/approved under policy; no delinquent Section 16 reports .
- Policy framework: formal related-party transaction approval via Audit Committee and Chief Legal & HR Officer .
Investment Implications
- Pay-for-performance alignment is credible: EPS-only ACI produced a below-target payout (52%) in 2024, while multi-year PSUs paid at 200% on sustained EBITDA margin performance—indicative of cyclically sensitive cash pay and high-operating-leverage equity pay .
- Equity-heavy package and strong ownership constraints reduce near-term sell pressure despite sizable Jan 2 vesting cadence (annual RSAs; triennial PSUs); hedging/pledging are prohibited; CEO must maintain ≥3x salary ownership and retain 25% of grants until compliant .
- Governance risk centers on control/entrenchment: dual roles (CEO + Vice Chairman) and family control (~61.7% votes) elevate independence concerns; mitigants include a Lead Independent Director and fully independent committees, and strong say-on-pay support (>98%) .
- Downside protection for investors: no employment agreement or cash severance; change-in-control costs are largely equity acceleration (indicative value $8.70M at 12/31/2024), aligning outcomes with shareholder value but potentially creating event-driven supply upon COC .