Rgc Resources (RGCO) AI Stock Analysis

• Market Cap: $221.09M
• Dividend Yield: 3.75%
• Average Volume (3M): 10.72K
• Price to Earnings (P/E): 17.0
• Beta (1Y): 0.55
• Revenue Growth: 12.63%
• EPS Growth: 10.99%
• Country: US
• Employees: 104
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Gas
• EPS (TTM): 0.47
• Shares Outstanding: 10,394,487
• 10 Day Avg. Volume: 15,306
• 30 Day Avg. Volume: 10,721
• PEG Ratio: 1.55
• Price to Book (P/B): 2.04
• Price to Sales (P/S): 2.43
• P/FCF Ratio: 28.14
• Enterprise Value/Market Cap: 1.72
• Enterprise Value/Revenue: 3.87
• Enterprise Value/Gross Profit: 13.15
• Enterprise Value/Ebitda: 10.97
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 1.3
• Revenue Forecast (FY): $101.20M

• Rating: 62 Neutral
• Price Target: $23.00 ▲(6.93% Upside)
• Action: Reiterated Date: 02/12/26
• Date: Action: Reiterated 02/12/26

The score is driven primarily by mid-range financial quality: solid recent profitability, but constrained by sustained leverage and only moderate cash-flow conversion. Valuation is supportive due to the ~3.9% dividend and reasonable P/E, while technicals are neutral and the latest earnings commentary is modestly positive but includes near-term headwinds (expected fourth-quarter loss).

Positive Factors

Regulated business model

Operating as a local distribution company with tariffed rates and a cost-of-gas pass-through creates predictable, regulated cash flows and an allowed return on invested capital. This regulatory framework supports durable revenue recovery for prudent investments and limits commodity margin exposure over multi-year horizons.

Infrastructure expansion and customer adds

Sustained main installations and new service connections expand rate base and customer count, supporting long-term distribution revenue and future rate-case recovery. Continuous network investment preserves reliability, creates capital growth drivers and underpins steady demand even as unit volumes vary seasonally.

Successful refinancing and longer-term debt

Extending maturities with a multi-year note reduces near-term refinancing risk and smooths interest expense volatility. Longer-term funding at reasonable spreads strengthens liquidity planning and supports capital spending programs, improving financial stability over a multi-year planning horizon.

Negative Factors

Elevated leverage

A capital structure with debt consistently above parity to equity limits financial flexibility for incremental investments or unexpected shocks. Higher leverage raises interest and refinancing sensitivity, constraining ability to fund growth from internal cash and increasing regulatory scrutiny around capital recovery.

Thin and uneven free cash flow

Weak free cash flow conversion versus reported earnings and historical volatility reduce internal funding for capex and dividends. Persistent thin FCF forces reliance on external financing for infrastructure, amplifying leverage and limiting capacity to absorb regulatory timing mismatches or fund strategic initiatives.

Regulatory timing and volume risks

Dependence on regulatory approvals creates timing and refund risk that can compress realized revenues. Coupled with declines in residential/commercial volumes, this can depress throughput-driven recovery and complicate rate-case outcomes, leaving earnings exposed to regulatory adjustments and slower demand trends.

Rgc Resources Business Overview & Revenue Model

Company Description

RGC Resources, Inc., through its subsidiaries, operates as an energy services company. It sells and distributes natural gas to residential, commercial, and industrial customers in Roanoke, Virginia, and the surrounding localities. The company also provides various unregulated services. It operates approximately 1,157 miles of transmission and distribution pipeline; and a liquefied natural gas storage facility, as well as owns and operates 6 metering stations. RGC Resources, Inc. was founded in 1883 and is based in Roanoke, Virginia.

How the Company Makes Money

Rgc Resources generates revenue primarily through the sale and distribution of natural gas to its customers. The company earns money by charging customers for the volume of natural gas consumed, with rates regulated by state authorities. Additionally, RGCO offers energy efficiency programs that may include incentives and rebates, enhancing customer loyalty and driving additional revenue. The company may also benefit from partnerships with local governments and organizations focused on renewable energy projects, which can contribute to its earnings through grants or collaborative projects aimed at enhancing energy efficiency and sustainability.

Rgc Resources Financial Statement Overview

Summary

Income statement is solid (net margin ~13% and improved recent profitability), but the balance sheet is meaningfully leveraged (debt ~1.2x equity) and free cash flow conversion has been thin and uneven, which limits financial flexibility.

Income Statement

Profitability is solid in the most recent periods, with TTM (Trailing-Twelve-Months) net margin around 13% and strong operating profitability, while revenue growth has stabilized to low-single-digits in TTM after a sharper swing in prior years. The key weakness is earnings volatility in the cycle—most notably the large loss in 2022—showing results can be impacted by non-recurring or cost-related shocks even in a regulated business.

Balance Sheet

The balance sheet is workable but leveraged: debt runs at roughly 1.2x equity in TTM (Trailing-Twelve-Months) and has remained above 1x for several years, limiting flexibility. Offsetting that, equity has been sustained and returns on equity have been consistently around the low-double-digits recently, indicating the capital structure is supporting acceptable shareholder returns despite the debt load.

Cash Flow

Cash generation is positive overall with TTM (Trailing-Twelve-Months) operating cash flow meaningfully positive and free cash flow turning positive again, helped by improving free-cash-flow growth. However, free cash flow remains relatively thin versus reported earnings (well below 1:1) and prior years included negative free cash flow, pointing to ongoing capital spending and periodic cash flow pressure.

Breakdown	TTM	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	98.31M	95.33M	84.64M	97.44M	84.17M	75.17M
Gross Profit	28.90M	21.38M	30.29M	29.77M	26.15M	25.49M
EBITDA	34.64M	35.39M	32.48M	30.40M	-29.46M	26.58M
Net Income	12.89M	13.28M	11.76M	11.30M	-31.73M	10.10M
Balance Sheet
Total Assets	341.04M	329.84M	320.70M	303.73M	290.31M	310.11M
Cash, Cash Equivalents and Short-Term Investments	2.66M	2.32M	894.18K	1.51M	4.90M	1.52M
Total Debt	156.19M	148.96M	148.64M	141.17M	137.00M	140.47M
Total Liabilities	224.61M	216.29M	212.56M	203.00M	197.22M	210.41M
Stockholders Equity	116.43M	113.55M	108.14M	100.73M	93.09M	99.70M
Cash Flow
Free Cash Flow	8.58M	8.22M	-4.66M	-1.51M	-9.91M	-8.40M
Operating Cash Flow	29.20M	28.95M	17.43M	23.80M	15.55M	11.57M
Investing Cash Flow	-21.17M	-20.73M	-22.03M	-27.40M	-30.62M	-25.85M
Financing Cash Flow	-7.48M	-6.79M	3.98M	218.94K	18.44M	15.51M

Rgc Resources Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.51
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RGCO, the sentiment is Negative. The current price of 21.51 is below the 20-day moving average (MA) of 21.62, below the 50-day MA of 21.62, and above the 200-day MA of 21.31, indicating a bearish trend. The MACD of -0.10 indicates Positive momentum. The RSI at 46.65 is Neutral, neither overbought nor oversold. The STOCH value of 19.62 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RGCO.

Rgc Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NWN	73 Outperform	$2.08B	19.95	7.20%	4.18%	11.27%	20.04%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
SPH	65 Neutral	$1.34B	10.11	22.70%	6.97%	7.94%	43.23%
SR	64 Neutral	$5.35B	19.66	8.46%	3.82%	-4.50%	2.49%
RGCO	62 Neutral	$221.09M	17.04	11.98%	3.75%	12.63%	10.99%
OPAL	47 Neutral	$350.26M	96.19	―	―	7.03%	-86.15%
NFE	43 Neutral	$327.24M	-0.22	-96.21%	―	-27.23%	-634.60%

Rgc Resources Corporate Events

RGC Resources Schedules Q1 2025 Results Conference Call

RGC Resources, Inc. plans to host a conference call with analysts to review its operating results for the first quarter ended December 31, 2025, providing the investment community with direct commentary from management on recent financial performance. The material used on the call is being furnished rather than filed under securities regulations, limiting its exposure to certain liabilities and clarifying that it will not automatically be incorporated into the company’s other securities law filings.

By choosing to furnish, not file, the call materials, the company signals a controlled approach to disclosure that still offers transparency to analysts while managing legal risk under the Securities Exchange Act of 1934. This structure is standard for many public companies and indicates that while stakeholders gain insight into quarterly operations, the information carries a different regulatory status than formally filed reports, which may influence how investors weigh the call’s content.

The most recent analyst rating on (RGCO) stock is a Buy with a $24.50 price target. To see the full list of analyst forecasts on Rgc Resources stock, see the RGCO Stock Forecast page.

RGC Resources Reports Lower Q1 Earnings Amid Cost Pressures

On February 5, 2026, RGC Resources, Inc. reported first-quarter 2026 consolidated earnings of $4.9 million, or $0.47 per share, for the period ended December 31, 2025, down from $5.3 million, or $0.51 per share, a year earlier, as flat margins and higher personnel, IT, property tax and depreciation expenses weighed on results despite lower interest costs. To address rising cost pressures, the company filed a rate case in early December seeking $4.3 million in additional annualized revenue, with interim rates taking effect on January 1, 2026 subject to regulatory review and potential refund, while Roanoke Gas continues to invest in system reliability and benefit from steady customer growth, including new housing connections and an unusually high number of reconnections during the quarter.

The most recent analyst rating on (RGCO) stock is a Hold with a $23.00 price target. To see the full list of analyst forecasts on Rgc Resources stock, see the RGCO Stock Forecast page.

RGC Resources refreshes board and appoints new leadership

At its annual shareholders meeting held on January 26, 2026, RGC Resources, Inc. shareholders elected Jacqueline L. Archer, Frank Russell Ellett and Robert B. Johnston as Class B directors for three-year terms ending in 2029, ratified Deloitte & Touche LLP as independent auditors for the fiscal year ending September 30, 2026, approved the issuance of an additional 50,000 common shares under the company’s stock bonus plan, and backed the firm’s executive compensation package in a non-binding advisory vote, while the board recognized the service of retiring directors Nancy Howell Agee and J. Allen Layman. Following the meeting, the board named John B. Williamson III as chairman and appointed Paul W. Nester as president and CEO of both RGC Resources and Roanoke Gas Company, alongside a refreshed senior management slate across the parent and its primary utility subsidiary, signaling continuity in governance with a strengthened leadership structure that may influence strategic direction, capital allocation and regulatory engagement for the company’s Virginia-focused gas operations.

The most recent analyst rating on (RGCO) stock is a Hold with a $23.00 price target. To see the full list of analyst forecasts on Rgc Resources stock, see the RGCO Stock Forecast page.

RGC Resources Discusses Q4 and Fiscal Year Results

RGC Resources, Inc. held a conference call with analysts to discuss its fourth quarter and fiscal year results ending September 30, 2025. The call aimed to provide insights into the company’s financial performance and operational outcomes, although specific details of the results were not disclosed in the release.

The most recent analyst rating on (RGCO) stock is a Hold with a $23.50 price target. To see the full list of analyst forecasts on Rgc Resources stock, see the RGCO Stock Forecast page.

RGC Resources Reports Fiscal Year Earnings Rise

RGC Resources, Inc. reported a significant rise in earnings for the fiscal year ending September 30, 2025, with a net income of $13.3 million compared to $11.8 million the previous year. This increase was driven by record gas deliveries and higher operating margins, despite challenges such as inflationary costs and reduced equity earnings from the Mountain Valley Pipeline. The company also experienced a net loss of $204,000 in the fourth quarter of 2025, attributed to seasonal factors and increased expenses.

The most recent analyst rating on (RGCO) stock is a Hold with a $23.50 price target. To see the full list of analyst forecasts on Rgc Resources stock, see the RGCO Stock Forecast page.