It has been about a month since the last earnings report for UGI (
UGI Quick Quote UGI - Free Report) . Shares have added about 4% in that time frame, outperforming 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 Q2 Earnings Surpass Estimates, 2021 EPS Guidance Up UGI Corp. reported second-quarter fiscal 2021 adjusted earnings of $1.99 per share, beating the Zacks Consensus Estimate of $1.72 by 15.7%. The bottom line also improved by 27.6% from the year-ago quarter’s earnings of $1.56 per share. It generated GAAP earnings of $2.33 per share for the reported quarter, up from the year-ago quarter’s figure of $1.07. Results benefited from extreme weather conditions along with increase in UGI Utilities’ base rates, which came into effect on Jan 1, 2021. Revenues
Revenues of $2,581 million for the fiscal second quarter improved 15.8% from the year-ago number of $2,229 million.
AmeriGas Propane: Revenues of $940 million for the quarter under review were up 17.2% from the year-ago number.
UGI International: Revenues summed $834 million, up 18.5% from the year-ago figure. Midstream & Marketing: Revenues of $484 million for the reported quarter increased 14.7% year over year. UGI Utilities: Revenues of $442 million were up 12.5% from the year-ago figure. Corporate & Other: This segment incurred a loss of $119 million, wider than the loss of $92 million in the comparable period last year. Highlights of the Release
During the quarter, it completed the buyout of Pine Run Midstream, which was immediately accretive to its earnings. The company remains on track to complete the acquisition of Mountaineer Gas Company in the second half the ongoing year.
Total interest expenses of $78 million were down 6% from the prior-year figure. Dividend Update
Concurrent to the release, the utility hiked its quarterly dividend by 4.5% to 34.5 cents per share. This marks the 34th consecutive annual dividend increase.
The utility increased its fiscal 2021 adjusted earnings per share expectation to $2.90-$3 from the prior guidance of $2.65-$2.95. Also, it expects its earnings to grow 6-10% and dividend to rise 4% in the long term.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -51.85% due to these changes.
Currently, UGI has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, UGI has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.