It has been about a month since the last earnings report for UGI (
UGI Quick Quote UGI - Free Report) . Shares have lost about 6.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is UGI due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
UGI Q2 Earnings Miss Estimates, Revenues Decline Y/Y UGI Corporation reported fiscal second-quarter 2023 operating earnings of $1.68 per share, which missed the Zacks Consensus Estimate of $1.84 by 8.7%. The bottom line also declined 12% from the year-ago quarter’s level of $1.91. Total Revenues
Revenues of $3,106 million missed the Zacks Consensus Estimate of $4,401 million by 29.4%. The top line also declined 10.4% from the year-ago quarter’s figure of $3,466 million.
Segmental Results AmeriGas Propane: Revenues of $867 million were down 17% from that recorded in the year-ago quarter. Retail gallons sold during the quarter declined 15% year over year. This was due to a shortage of drivers and warmer weather conditions (than the previous year) that also contributed to customer attrition and limited structural conservation. UGI International: Revenues totaled nearly $948 million, down 23% from the year-ago level. Retail volume decreased 10% due to warmer weather conditions. Midstream & Marketing: Revenues of $638 million were down 5% year over year. UGI Utilities: Sales of $774 million were up 9% from that registered in the year-ago period. Corporate & Other: This segment incurred a loss of $121 million, narrower than the prior-year quarter’s loss of $184 million. Highlights of the Release
As of Mar 31, 2023, UGI reported a strong balance sheet, with available liquidity of approximately $1.9 billion.
Total interest expenses came in at $93 million, up 13.4% from the year-ago quarter’s $82 million. During the reported quarter, the company entered into a joint venture with Archaea Energy to develop a renewable natural gas project in Pennsylvania. This brought the total renewables investment to more than $500 million to date. Guidance
UGI reaffirmed its fiscal 2023 adjusted earnings guidance in the range of $2.75-$2.90 per share. The Zacks Consensus Estimate for the same is pegged at $2.87 per share, higher than $2.82, the midpoint of the company’s guided range.
UGI aims to deliver 6-10% earnings per share (EPS) growth and 4% dividend growth over the long term. 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.
At this time, UGI has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
UGI has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.