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UGI Corp (UGI)
NYSE:UGI
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UGI
(NYSE:UGI)
76Outperform
Positive Factors
Earnings
UGI announced F1Q25 adjusted EPS that beat Street and MSUSA estimates.
Growth Potential
Management is focused on new projects and acquisitions, indicating confidence in the company's future growth.
Undervaluation
UGI's undervaluation is highlighted with a ~8x NTM P/E ratio, implying a significant disconnect to midstream and utility peers.
Negative Factors
Operational Challenges
Challenges include operational fixes at AmeriGas still being a work-in-progress, a difficult comp year for Midstream & Marketing, potential regulatory lag at UGI Utilities, and impacts at UGI International related to damages at its LPG supply terminal in France.
Volume Decline
AmeriGas generated $320mn in EBITDA for FY24, a decline from FY23, with management expecting continued volume declines in FY25.
UGI (UGI) vs. S&P 500 (SPY)
Market Cap
$7.02B
Dividend Yield4.58%
Average Volume (3M)2.35M
Price to Earnings (P/E)12.8
Beta (1Y)0.53
Revenue Growth-14.01%
EPS GrowthN/A
CountryUS
Employees9,750
SectorUtilities
Sector Strength94
IndustryRegulated Gas
Share Statistics
EPS (TTM)2.54
Shares Outstanding214,813,000
10 Day Avg. Volume2,441,416
30 Day Avg. Volume2,346,761
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.87
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit3.56
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$36.67Price Target Upside11.83% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
UGI Business Overview & Revenue Model
Company DescriptionUGI Corporation distributes, stores, transports, and markets energy products and related services in the United States and internationally. The company operates through four segments: AmeriGas Propane, UGI International, Midstream & Marketing, and UGI Utilities. It distributes propane to approximately 1.4 million residential, commercial/industrial, motor fuel, agricultural, and wholesale customers through 1,600 propane distribution location. The company also distributes liquefied petroleum gases (LPG) to residential, commercial, industrial, agricultural, wholesale and automobile fuel customers; and provides logistics, storage, and other services to third-party LPG distributors. In addition, it engages in the retail sale of natural gas, liquid fuels, and electricity to approximately 12,600 residential, commercial, and industrial customers at 42,400 locations. Further, the company distributes natural gas to approximately 672,000 customers in eastern and central Pennsylvania counties through its distribution system of approximately 12,400 miles of gas mains; and supplies electricity to approximately 62,500 customers in northeastern Pennsylvania through 2,600 miles of lines and 14 substations. Additionally, it operates electric generation facilities, which include coal-fired, landfill gas-fueled, solar-powered, and natural gas-fueled facilities; a natural gas liquefaction, storage, and vaporization facility; propane storage and propane-air mixing stations; and rail transshipment terminals. It also manages natural gas pipeline and storage contracts; develops, owns, and operates pipelines, gathering infrastructure, and gas storage facilities. UGI Corporation was incorporated in 1991 and is based in King of Prussia, Pennsylvania.
How the Company Makes MoneyUGI Corporation makes money through several key revenue streams. In the regulated energy segment, UGI generates income by distributing and transporting natural gas and electricity to residential, commercial, and industrial customers. This segment typically ensures stable and predictable revenue due to regulated pricing structures. In the unregulated segment, UGI earns revenue by selling propane and butane through its subsidiaries like AmeriGas and UGI International, which operate in the U.S. and various European countries. The company benefits from its extensive supply chain network, allowing it to efficiently market and deliver energy products. Additionally, UGI engages in energy marketing and trading activities, which contribute to its earnings by capitalizing on market opportunities and price fluctuations. Strategic partnerships and acquisitions also play a vital role, enabling UGI to expand its market reach and enhance its service offerings.
UGI Financial Statement Overview
Summary
UGI's financial performance reflects a well-managed utility company with strengths in cash flow generation and profitability despite revenue fluctuations. The balance sheet is solid but carries a moderate level of debt, which requires careful monitoring. Overall, UGI is in a stable financial position, but attention is needed on revenue growth and managing leverage.Income Statement
UGI's income statement shows a volatile revenue trajectory. Recent TTM data indicates a decline in revenue compared to the previous year, with a Gross Profit Margin of 61.99% and Net Profit Margin of 7.72%. While EBIT and EBITDA margins are solid at 13.31% and 21.11%, respectively, the company has faced challenges in maintaining consistent profitability due to fluctuations in revenue and expenses.72
Positive
Balance Sheet
UGI maintains a stable financial structure with a Debt-to-Equity Ratio of 1.49, indicating moderate leverage. The Return on Equity stands at a healthy 12.01%, reflecting good profitability on shareholders' investment. The Equity Ratio is 29.71%, suggesting a balanced approach towards equity financing. However, the high total debt relative to equity may pose future risks if not managed effectively.65
Positive
Cash Flow
UGI demonstrates strong cash flow management with a significant Operating Cash Flow to Net Income Ratio of 2.23, indicating robust cash conversion. The Free Cash Flow to Net Income Ratio is 1.07, showing effective capital expenditure management. The Free Cash Flow Growth Rate shows a substantial increase, highlighting improved cash generation capabilities.78
Positive
| Breakdown | ||||
| Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 7.21B | 8.93B | 10.11B | 7.45B | 6.56B | Gross Profit |
| 3.68B | 1.99B | 4.13B | 4.83B | 3.41B | EBIT |
| 770.00M | -1.44B | 1.67B | 2.35B | 982.00M | EBITDA |
| 1.28B | -886.00M | 2.19B | 2.94B | 1.58B | Net Income Common Stockholders |
| 269.00M | -1.50B | 1.07B | 1.47B | 532.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 213.00M | 241.00M | 405.00M | 855.00M | 336.00M | Total Assets |
| 15.10B | 15.40B | 17.57B | 16.72B | 13.98B | Total Debt |
| 6.68B | 7.25B | 7.00B | 6.82B | 6.38B | Net Debt |
| 6.46B | 7.01B | 6.59B | 5.96B | 6.04B | Total Liabilities |
| 10.74B | 11.01B | 11.50B | 11.19B | 9.85B | Stockholders Equity |
| 4.34B | 4.39B | 6.07B | 5.52B | 4.13B |
| Cash Flow | Free Cash Flow | |||
| 386.00M | 133.00M | -88.00M | 791.00M | 447.00M | Operating Cash Flow |
| 1.18B | 1.11B | 716.00M | 1.48B | 1.10B | Investing Cash Flow |
| -792.00M | -1.08B | -1.01B | -1.11B | -649.00M | Financing Cash Flow |
| -506.00M | -168.00M | -51.00M | 166.00M | -635.00M |
UGI Technical Analysis
Positive
32.79
Price Trends
32.55
Positive
30.83
Positive
27.37
Positive
Market Momentum
0.14
Negative
54.41
Neutral
52.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UGI, the sentiment is Positive. The current price of 32.79 is above the 20-day moving average (MA) of 32.15, above the 50-day MA of 32.55, and above the 200-day MA of 27.37, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 54.41 is Neutral, neither overbought nor oversold. The STOCH value of 52.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UGI.
UGI Risk Analysis
UGI disclosed 35 risk factors in its most recent earnings report. UGI reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
UGI Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $3.02B | 24.96 | 9.00% | 1.94% | 17.72% | 11.33% | |
76 Outperform | $7.02B | 12.84 | 12.22% | 4.58% | -14.01% | ― | |
75 Outperform | $4.52B | 18.76 | 7.76% | 4.00% | -3.96% | 11.40% | |
75 Outperform | $4.71B | 20.09 | 7.59% | 3.38% | -12.16% | -5.73% | |
71 Outperform | $4.94B | 14.83 | 15.15% | 3.61% | 9.18% | 36.67% | |
71 Outperform | $5.23B | 26.36 | 5.84% | 3.42% | -5.92% | 29.47% | |
63 Neutral | $8.54B | 12.48 | 6.21% | 4.38% | 3.32% | -10.32% |
* Utilities Sector Average
Performance Comparison
UGI
UGI
32.79
8.34
34.11%
CPK
Chesapeake Utilities
131.67
26.80
25.56%
SR
Spire
76.54
17.40
29.42%
NJR
New Jersey Resources
48.94
6.52
15.37%
SWX
Southwest Gas
72.21
0.03
0.04%
OGS
ONE Gas
78.51
15.89
25.38%
UGI Earnings Call Summary
Earnings Call Date:Feb 05, 2025
(Q1-2025)
| % Change Since: 5.71%|
Next Earnings Date:May 07, 2025
Earnings Call Sentiment Positive
UGI Corporation's Q1 2025 earnings call showed strong financial performance with significant EPS growth and strategic investments in infrastructure. The company was recognized for customer service excellence and made a strategic acquisition in the midstream segment. However, challenges remain with lower EBITDA in the midstream segment and performance issues at AmeriGas. Overall, the positive aspects slightly outweigh the negatives.Q1-2025 Updates
Positive Updates
Record Adjusted Diluted EPS
UGI reported adjusted diluted earnings per share of $1.37, which is 14% higher than the prior year period.
Strong Investment in Infrastructure
Over $200 million in capital investment was deployed, primarily in natural gas businesses, enhancing system reliability and supporting customer additions.
Recognition of Customer Service Excellence
UGI Utilities was recognized as a Cogent 2024 utility customer champion, validating its customer-centric approach and high satisfaction levels.
Successful Acquisition and Expansion in Midstream Segment
Acquisition of Superior Appalachian for $120 million, which is expected to be accretive to earnings and enhance future synergy.
Improved Liquidity Position
UGI had available liquidity of $1.5 billion at the end of the quarter.
Negative Updates
Decline in Midstream and Marketing EBITDA
The segment reported EBITDA of $95 million compared to $102 million in the prior year, due to lower margins from gathering and processing activities.
Challenges in AmeriGas Performance
EBIT at AmeriGas was up $3 million, but higher income tax expenses led to a 28 cent decline in adjusted diluted EPS.
Lower LPG Volumes at AmeriGas
LPG volumes were down 1% due to customer attrition, despite the offset from colder weather.
Company Guidance
During the UGI Corporation Q1 2025 earnings call, several key metrics and strategic initiatives were highlighted. The company reported an adjusted diluted earnings per share of $1.37, representing a 14% increase from the prior year. Capital investments of over $200 million were deployed, primarily in the natural gas sector, enhancing infrastructure modernization. UGI's midstream and marketing segment completed RNG facilities and acquired Superior Appalachian for $120 million, a transaction expected to be accretive to earnings within the first year. The company also filed for a $110 million gas base rate increase with the Pennsylvania Public Utility Commission to support $750 million in system improvements. Additionally, UGI maintained a guidance range of $2.75 to $3.05 for fiscal 2025. AmeriGas was noted for its organizational restructuring to improve service quality and financial performance, while UGI International continued to demonstrate strong cash generation capacity. The company reiterated its commitment to disciplined capital allocation, operational excellence, and long-term shareholder value creation.UGI Corporate Events
Business Operations and StrategyFinancial Disclosures
UGI Corporation Reports Strong Q1 2025 Earnings
Positive
Feb 6, 2025
UGI Corporation reported its fiscal first-quarter results for 2025, showing a notable increase in adjusted diluted earnings per share from the previous year, driven by strong performance in its natural gas and international propane businesses. The company also filed for a gas base rate increase in Pennsylvania and announced the redemption of AmeriGas’s 2025 Senior Notes, aiming to improve operational performance and deliver consistent growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.