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Shares of the company have gained 11.8% in the past three months against the industry’s decline of 1.3%.
Mixed Growth Projections
The Zacks Consensus Estimate for fiscal 2020 earnings is pegged at $2.54 per share and for revenues stands at $6.99 billion. The bottom line suggests an increase of 11.40% from the year-ago reported figure. However, the top line indicates a 4.50% decline from the year-earlier reported number.
The Zacks Consensus Estimate for fiscal 2021 earnings stands at $2.87 per share and for revenues, $7.78 billion. The bottom line hints at a 12.99% improvement from the prior-year reported figure. The same for the top line implies 11.22% growth from the year-ago reported number.
Robust Inorganic Profile
UGI Corporation’s subsidiary completed the acquisition of GHI Energy, LLC, in July with its focus on providing renewable natural gas to vehicle fleets by procuring supply from diverse sources across the country. Moreover, the buyout of AmeriGas Partners, L.P. in the third quarter of fiscal 2019 enables the company to enhance its cash flow for repaying debts and funding capital investments in its natural gas business.
In August 2019, the utility acquired Columbia Midstream Group, LLC (CMG) from TC Energy Corporation (TRP), which is now known as UGI Appalachia. It continued to perform very well in the first nine months of fiscal 2020. Such strategic buyouts will help the company curb competition in the market and grow its customer base, thereby boosting its performance in the process.
Steady Dividend Raises
Having been consistent in its operating performance and deploying capital efficiently, the company has been able to reward its shareholders through annual dividend hikes and share repurchases. With two dividend increases in fiscal 2019, UGI Corporation’s dividend growth saw a CAGR of 9.4% over the past decade. In April, the company raised its quarterly dividend to 33 cents per share. This is the 33rd consecutive year of dividend increase. The utility has a current dividend yield of 3.81% compared with the industry’s 3.46% average.
Strong Financial Position
As of Jun 30, 2020, the company had liquidity of $1.6 billion, up from $1.2 billion in the quarter ending Mar 31, 2020. UGI Corporation’s times interest earned (TIE) ratio improved to 2.65 at the end of third-quarter fiscal 2020 from 2.28 at the end of the fiscal second quarter. The strong TIE ratio reflects the company’s ability to meet its debt obligations in the near future.
Solid Return on Equity (ROE)
ROE is a financial metric that helps an investor understand how efficiently the company is using its shareholders’ funds for generating returns. The company’s ROE for the trailing 12 months is 13.19% compared with the industry’s 9.37%, reflecting its efficiency in utilizing its stockholders’ money.
Favorable VGM score
UGI Corporation currently has a VGM Score of B. Our research shows that stocks with a Style Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.
Stocks to Consider
A few better-ranked utilities are Portland General Electric Company (POR - Free Report) , Korea Electric Power Corporation (KEP - Free Report) and Essential Utilities Inc. (WTRG - Free Report) , all carrying a Zacks Rank of 2 at present.
Portland General Electric Company delivered an earnings surprise of 7.74%, on average, in the last four quarters. The company has a long-term earnings growth rate of 5.14%.
Korea Electric Power has a long-term earnings growth rate of 5%. The Zacks Consensus Estimate for 2020 earnings has been steady in the past 60 days.
Essential Utilities has a long-term earnings growth rate of 6.01%. The company delivered an earnings surprise of 9.67%, on average, in the trailing four quarters.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
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Reasons to Add UGI Corporation (UGI) Stock to Your Portfolio
UGI Corporation’s (UGI - Free Report) systematic acquisitions, improving customer base and a strong liquidity position are key tailwinds.
Zacks Rank & Price Performance
UGI Corporation currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of the company have gained 11.8% in the past three months against the industry’s decline of 1.3%.
Mixed Growth Projections
The Zacks Consensus Estimate for fiscal 2020 earnings is pegged at $2.54 per share and for revenues stands at $6.99 billion. The bottom line suggests an increase of 11.40% from the year-ago reported figure. However, the top line indicates a 4.50% decline from the year-earlier reported number.
The Zacks Consensus Estimate for fiscal 2021 earnings stands at $2.87 per share and for revenues, $7.78 billion. The bottom line hints at a 12.99% improvement from the prior-year reported figure. The same for the top line implies 11.22% growth from the year-ago reported number.
Robust Inorganic Profile
UGI Corporation’s subsidiary completed the acquisition of GHI Energy, LLC, in July with its focus on providing renewable natural gas to vehicle fleets by procuring supply from diverse sources across the country. Moreover, the buyout of AmeriGas Partners, L.P. in the third quarter of fiscal 2019 enables the company to enhance its cash flow for repaying debts and funding capital investments in its natural gas business.
In August 2019, the utility acquired Columbia Midstream Group, LLC (CMG) from TC Energy Corporation (TRP), which is now known as UGI Appalachia. It continued to perform very well in the first nine months of fiscal 2020. Such strategic buyouts will help the company curb competition in the market and grow its customer base, thereby boosting its performance in the process.
Steady Dividend Raises
Having been consistent in its operating performance and deploying capital efficiently, the company has been able to reward its shareholders through annual dividend hikes and share repurchases. With two dividend increases in fiscal 2019, UGI Corporation’s dividend growth saw a CAGR of 9.4% over the past decade. In April, the company raised its quarterly dividend to 33 cents per share. This is the 33rd consecutive year of dividend increase. The utility has a current dividend yield of 3.81% compared with the industry’s 3.46% average.
Strong Financial Position
As of Jun 30, 2020, the company had liquidity of $1.6 billion, up from $1.2 billion in the quarter ending Mar 31, 2020. UGI Corporation’s times interest earned (TIE) ratio improved to 2.65 at the end of third-quarter fiscal 2020 from 2.28 at the end of the fiscal second quarter. The strong TIE ratio reflects the company’s ability to meet its debt obligations in the near future.
Solid Return on Equity (ROE)
ROE is a financial metric that helps an investor understand how efficiently the company is using its shareholders’ funds for generating returns. The company’s ROE for the trailing 12 months is 13.19% compared with the industry’s 9.37%, reflecting its efficiency in utilizing its stockholders’ money.
Favorable VGM score
UGI Corporation currently has a VGM Score of B. Our research shows that stocks with a Style Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.
Stocks to Consider
A few better-ranked utilities are Portland General Electric Company (POR - Free Report) , Korea Electric Power Corporation (KEP - Free Report) and Essential Utilities Inc. (WTRG - Free Report) , all carrying a Zacks Rank of 2 at present.
Portland General Electric Company delivered an earnings surprise of 7.74%, on average, in the last four quarters. The company has a long-term earnings growth rate of 5.14%.
Korea Electric Power has a long-term earnings growth rate of 5%. The Zacks Consensus Estimate for 2020 earnings has been steady in the past 60 days.
Essential Utilities has a long-term earnings growth rate of 6.01%. The company delivered an earnings surprise of 9.67%, on average, in the trailing four quarters.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>