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Why Is UGI (UGI) Up 1.5% Since Last Earnings Report?

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It has been about a month since the last earnings report for UGI (UGI - Free Report) . Shares have added about 1.5% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is UGI due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

UGI Corp's Q3 Earnings Beat Estimates, Revenues Miss

UGI Corp delivered third-quarter fiscal 2020 adjusted earnings of 8 cents per share. The Zacks Consensus Estimate was of a loss of 15 cents per share. The bottom line, however, decreased 38.5% from the prior-year quarter’s figure of 13 cents per share.

The company generated GAAP earnings of 41 cents per share in the reported quarter against the year-ago quarter’s GAAP loss of a cent.

Revenue Update

Revenues of $1,199.3 million in the fiscal third quarter missed the Zacks Consensus Estimate of $1,519 million by 21%. Also, the top line declined 12.1% from the year-ago quarter’s figure of $1,363.7 million.

Segmental Revenues

AmeriGas Propane: Revenues of $450.9 million in the quarter under review were down 5.8% from year-ago quarter’s number.

UGI International: Revenues summed $371.5 million, down 23.7% from the year-ago quarter’s figure.

Midstream & Marketing: Revenues of $222.5 million in the reported quarter fell16.8% year over year.

UGI Utilities: Revenues of $179.1 million were up 9.3% from the year-ago quarter’s reported figure.

Corporate & Other: This segment incurred a loss of $24.7 million, narrower than the loss of $32.8 million in third-quarter fiscal 2019.

Operational Highlights

Colder-than-normal weather in the company’s domestic business areas along with cost-management efforts supported the results, thereby offsetting the negative impact of waning demand from the commercial group due to COVID-19 pandemic.

As of Jun 30, the company’s total available liquidity was $1.6 billion, up from $1.2 billion at the end of Mar 31, 2020.

Total interest expenses of $80.8 million were up 33.6% from the prior-year quarter’s figure.

Guidance

The company raised fiscal 2020 adjusted earnings per share outlook to $2.45-$2.55 including the negative impact of COVID-19 and a tax benefit.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

Currently, UGI has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

UGI has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.


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