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APA Group APA

Morningstar Rating
A$8.39 0.00 (0.00%)
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Company Report

Accretive Expansion Opportunities Underpin a Good Outlook for APA Group

APA Group is Australia's premier gas infrastructure company. Limited regulation, scale, and a superior skills base help it capitalize on gas demand growth and generate competitive advantages that warrant a narrow economic moat. However, gas market reform will weaken its competitive advantages. Fair value uncertainty is medium, as secure revenue is balanced by high gearing and limited transparency over customer contracts.

Price vs Fair Value

APA is trading at a 10% discount.
Price
A$8.39
Fair Value
A$5.70
Uncertainty
Medium
1-Star Price
A$77.92
5-Star Price
A$9.38
Economic Moat
Rwgqs
Capital Allocation
Wbl

Bulls Say, Bears Say

Bulls

APA Group owns and operates an excellent portfolio of gas infrastructure assets. Its large footprint ensures it is at least partially exposed to growth anywhere in the country.

Bears

Gas market reform is a risk to returns. From 2018, high levels of financial disclosure help customers negotiate better deals. This is backed up by binding arbitration. A new review underway will consider full regulation of its best assets.

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Trading Information

Previous Close Price
A$8.39
Day Range
A$8.278.43
52-Week Range
A$7.7810.63
Bid/Ask
A$8.37 / A$8.43
Market Cap
A$10.77 Bil
Volume/Avg
1.7 Mil / 2.9 Mil

Key Statistics

Price/Earnings (Normalized)
8.49
Price/Sales
3.59
Dividend Yield (Trailing)
6.46%
Dividend Yield (Forward)
6.46%
Total Yield
6.46%

Company Profile

APA Group is Australia's largest gas infrastructure company with an extensive portfolio of transmission pipelines, distribution networks, and storage facilities, and is increasingly investing in renewable energy generation, electricity transmission, and batteries. It is internally managed and has direct operational control over all assets. It owns minority stakes in a few smaller gas infrastructure companies and manages operations for most of these. The stapled securities comprise a unit in Australian Pipeline Trust and in APT Investment Trust.
Sector
Utilities
Industry
Utilities - Regulated Gas
Stock Style Box
Mid Growth
Total Number of Employees
1,600

Competitors

Valuation

Metric
APA
WMB
KMI
Price/Earnings (Normalized)
8.4920.3617.06
Price/Book Value
3.033.821.34
Price/Sales
3.594.362.66
Price/Cash Flow
8.388.136.62
Price/Earnings
APA
WMB
KMI

Financial Strength

Metric
APA
WMB
KMI
Quick Ratio
1.120.650.23
Current Ratio
1.270.770.35
Interest Coverage
3.394.502.78
Quick Ratio
APA
WMB
KMI

Profitability

Metric
APA
WMB
KMI
Return on Assets (Normalized)
6.65%4.67%3.46%
Return on Equity (Normalized)
47.49%19.77%7.89%
Return on Invested Capital (Normalized)
10.73%8.25%6.00%
Return on Assets
APA
WMB
KMI
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