A month has gone by since the last earnings report for UGI (UGI Quick QuoteUGI - Free Report) . Shares have added about 4.7% 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 the most recent earnings report in order to get a better handle on the important catalysts.

UGI Q3 Earnings Surpass Estimates, Revenues Decline Y/Y

UGI Corporation reported fiscal third-quarter 2024 operating earnings of 6 cents per share, which surpassed the Zacks Consensus Estimate of a loss of 5 cents per share by 220%. The bottom line also increased from break-even earnings in the year-ago quarter.

Total Revenues

Revenues of $1.38 billion missed the consensus estimate of $1.67 billion by 17.3%. The top line also declined 16.9% from the year-ago quarter’s figure of $1.66 billion.

Segmental Results

AmeriGas Propane: Revenues of $445 million were down 13.4% from the year-ago quarter. Retail gallons sold during the quarter decreased 12.9% year over year due to warmer weather and continued customer attrition.

UGI International: Revenues totaled approximately $455 million, down 25.5% from the year-ago level. Retail volume decreased 3.8% year over year.

Midstream & Marketing: Revenues of $253 million were down 9.3% year over year.

UGI Utilities: Sales of $257 million were down 7.6% from the year-ago period.

Corporate & Other: This segment incurred a loss of $30 million, wider than the prior-year quarter’s loss of $23 million.

Highlights of the Release

The company reported strong third-quarter results, led by record earnings from resilient and growth-oriented natural gas businesses and improved financial results from UGI International.

The Operating and administrative expenses were down by $38 million year-over-year.

Total interest expenses were $96 million, flat with the year-ago quarter’s figure.

The company has refinanced more than $1 billion of debt so far this year and reduced about $460 million of debt at AmeriGas Propane.

Guidance

UGI anticipates fiscal 2024 adjusted earnings to be in the range of $2.70-$3.00 per share. The Zacks Consensus Estimate is pegged at $2.92 per share, which is higher than $2.85, the midpoint of the company’s guided range.

 

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month.

The consensus estimate has shifted -50% due to these changes.

VGM Scores

At this time, UGI has a subpar Growth Score of D, a grade with the same score on the momentum front. 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 B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions 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.

Performance of an Industry Player

UGI is part of the Zacks Utility - Gas Distribution industry. Over the past month, ONE Gas (OGS Quick QuoteOGS - Free Report) , a stock from the same industry, has gained 3.6%. The company reported its results for the quarter ended June 2024 more than a month ago.

ONE Gas reported revenues of $354.14 million in the last reported quarter, representing a year-over-year change of -11%. EPS of $0.48 for the same period compares with $0.58 a year ago.

ONE Gas is expected to post earnings of $0.43 per share for the current quarter, representing a year-over-year change of -4.4%. Over the last 30 days, the Zacks Consensus Estimate has changed +4.9%.

ONE Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.