We are reaffirming our $109 fair value estimate for Atmos Energy after the company reported fiscal 2023 earnings per share of $6.10, compared with $5.60 in the year-ago period. The shares are down 11% since hitting their high in July and now trade in line with our fair value estimate as of Nov. 8. Our narrow moat rating is unchanged.
Constructive regulation allows Atmos to adjust customer rates within six months for about 90% of capital investments. This reduces regulatory lag and, combined with customer growth, allows Atmos to earn returns at or above allowed returns.
Dividend-paying stocks like Atmos are sensitive to interest rates. As interest rates go up, dividend-paying stocks often underperform the broader market.
|
Metric
|
ATO
|
NJR
|
NI
|
|---|---|---|---|
Price/Earnings (Normalized) | 18.58 | 16.08 | 16.64 |
Price/Book Value | 1.56 | 2.13 | 1.78 |
Price/Sales | 3.87 | 2.16 | 2.02 |
Price/Cash Flow | 10.68 | 10.95 | 6.69 |
|
Metric
|
ATO
|
NJR
|
NI
|
|---|---|---|---|
Quick Ratio | 0.26 | 0.13 | 0.15 |
Current Ratio | 0.65 | 0.66 | 0.41 |
Interest Coverage | 8.23 | 3.52 | 2.93 |
|
Metric
|
ATO
|
NJR
|
NI
|
|---|---|---|---|
Return on Assets (Normalized) | 3.76% | 4.09% | 2.71% |
Return on Equity (Normalized) | 8.22% | 13.46% | 12.15% |
Return on Invested Capital (Normalized) | 5.39% | 7.08% | 5.56% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|
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GASNY
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SNMRF
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SNMRY
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HOKCY
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HOKCF
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NI
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NFE
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NJR
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