Nuno Espirito Santo's men have produced a string of impressive displays after winning promotion to the top flight, which culminated in last weekend's 1-1 draw at Manchester United.
With just one Premier League defeat from six games, Hughes admits Wolves deserve all the plaudits coming their way – but intends for the Saints to bring everyone at Molineux back down to earth on Saturday.
"They do impress you with how they approach the game, with a lot of depth to their play," Hughes said.
"They can rotate the ball and have a danger in key areas of the field, with good threats in wider areas.
"They are very positive and proficient in what they do, having come off the back of a really outstanding season last year so they are in a really good frame of mind confidence-wise.
"They are well drilled, they know what they are about and that is why they have made a good start.
"We will have to be ready for them, but clearly we have threats of our own which we can test them with."
The Southampton manager added at a press conference: "When you come into the Premier League as a promoted team, everything is bright and shiny, everyone is enthused and excited.
"Clearly that will still be in place in terms of their attitude, because they have had nothing really to dent their confidence up to this point and that is credit to them.
"It is about making sure we understand what they are trying to do and how we negate that."
Hughes accepts Southampton remain very much a work in progress as he looks to move the squad on from last season's battle to stay up.
Missing on-loan striker Danny Ings at Liverpool, the Saints went down 3-0 which was a third Premier League defeat of a so far indifferent campaign.
Hughes, though, is confident things are slowly starting to come together.
"We are still in need of a little bit more time, but I see good signs of what we are trying to do," said Hughes, who took on the manager's job permanently over the summer having been parachuted in during March.
"A lot of things we are working on in training become natural, which shows the work we are doing is being transferred onto the pitch."