The choice of the stator hub configuration (i.e., cantilevered versus shrouded) is an important design decision in the preliminary design stage of an axial compressor. Therefore, it is important to understand the effect of the stator hub configuration on the aerodynamic performance. In particular, the stator hub configuration fundamentally affects the leakage flow across the stator. The effect of the stator hub configuration on the leakage flow and its consequent aerodynamic mixing loss with the main flow within the stator row is systematically investigated in this study. In the first part of the paper, a simple model is formulated to estimate the leakage loss across the stator hub as a function of fundamental stage design parameters, such as the flow coefficient, the degree of reaction, and the work coefficient, in combination with some relevant geometric parameters including the clearance/span, the pitch-to-chord ratio, and the number of seals for the shrouded geometry. The model is exercised in order to understand the effect of each of these design parameters on the leakage loss. It is found that, for a given flow coefficient and work coefficient, the leakage loss across the stator is substantially influenced by the degree of reaction. When a cantilevered stator is compared with a shrouded stator with a single seal at the same clearance, it is shown that a shrouded configuration is generally favored as a higher degree of reaction is selected, whereas a cantilevered configuration is desirable for a lower degree of reaction. Further to this, it is demonstrated that, for shrouded stators, an additional aerodynamic benefit can be achieved by using multiple seals. The second part of the paper investigates the effect of the rotating surfaces. Traditionally, only the pressure loss has been considered for stators. However, the current advanced computational fluid dynamics (CFD) generally includes the leakage path with associated rotating surfaces, which impart energy to the flow. It is shown that the conventional loss coefficient, based on considering only the pressure loss, is misleading when hub leakage flows are modeled in detail, because there is energy addition due to the rotation of the hub or the shroud seals for the cantilevered stator and the shrouded stator, respectively. The calculation of the entropy generation across the stator is a better measure of relative performance when comparing two different stator hub configurations with detailed CFD.