Ugi Corp /Pa/ (NYSE: UGI)

Sector: Utilities Industry: Utilities - Regulated Gas CIK: 0000884614
Market Cap 8.33 Bn
P/B 1.67
P/E 13.88
P/S 1.13
ROIC (Qtr) 7.53
Div Yield % 3.89
Rev 1y % (Qtr) 2.61
Total Debt (Qtr) 7.21 Bn
Debt/Equity (Qtr) 1.44
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About

UGI Corp, known by its ticker symbol UGI, is a prominent player in the energy industry, specializing in the distribution and sale of energy products such as propane, natural gas, and electricity. The company operates in the energy sector, spanning across 17 states and the District of Columbia, serving over 2 million customers through its three primary segments: Gas Distribution, Propane Distribution, and Electric Distribution. The Gas Distribution segment is the backbone of UGI Corp, accounting for approximately 70% of the company's total revenue....

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Investment thesis

Bull case

  • Operating cash flow of 1.13B provides strong 62.72x coverage of stock compensation 18M, indicating sustainable incentive practices.
  • Tangible assets of 12.67B provide robust 15.79x coverage of other current liabilities 802M, indicating strong asset backing.
  • Operating cash flow of 1.13B provides strong 2.88x coverage of inventory 392M, indicating efficient inventory management.
  • Retained earnings of 3.55B provide strong 4.43x coverage of other current liabilities 802M, indicating earnings quality.
  • Operating cash flow of 1.13B provides strong 2.31x coverage of operating expenses 489M, showing operational efficiency.

Bear case

  • Operating cash flow of 1.13B barely covers its investment activities of (612M), with a coverage ratio of -1.84, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 1.13B provides thin coverage of dividend payments of (322M) with a -3.51 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 271M provide limited coverage of acquisition spending of 244M, which is 1.11x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • High receivables of 1.22B relative to inventory of 392M (3.11 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of 282M provides weak coverage of capital expenditures of 847M, with a 0.33 ratio suggesting additional external financing needs for growth initiatives.

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Utilities - Regulated Gas
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ATO Atmos Energy Corp 28.99 Bn 23.20 5.95 9.63 Bn
2 NI Nisource Inc. 14.62 Bn 27.48 3.16 16.21 Bn
3 UGI Ugi Corp /Pa/ 8.33 Bn 13.88 1.13 7.21 Bn
4 NJR New Jersey Resources Corp 5.43 Bn 16.61 2.52 3.97 Bn
5 BKH Black Hills Corp /Sd/ 5.38 Bn 18.44 2.33 4.70 Bn
6 SR Spire Inc 5.36 Bn 19.83 2.09 5.35 Bn
7 SWX Southwest Gas Holdings, Inc. 5.04 Bn 19.06 1.48 3.51 Bn
8 OGS ONE Gas, Inc. 4.50 Bn 29.67 3.07 3.40 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.96 0.79
EV to Cash from Ops. EV/CFO 13.38 18.36
EV to Debt EV to Debt 2.09 1.86
EV to EBIT EV/EBIT 14.39 -126.33
EV to EBITDA EV/EBITDA 9.23 11.96
EV to Free Cash Flow [EV/FCF] EV/FCF 53.57 -73.99
EV to Market Cap EV to Market Cap 1.81 1.71
EV to Revenue EV/Rev 2.06 3.19
Price to Book Value [P/B] P/B 1.67 2.59
Price to Earnings [P/E] P/E 13.88 77.08
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.86 1.42
Dividend Payout Ratio % Div Payout % (Qtr) 54.00 47.06
Dividend per Basic Share Div per Share (Qtr) 1.50 1.78
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 114.24 54.25
Interest Coverage Int. cover (Qtr) 2.50 3.17
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 0.47 -16.87
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 10.16 44.73
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 -0.03
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 12.12 6.88
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 3.80 113.90
EBIT Growth (1y) % EBIT 1y % (Qtr) 1.65 26.96
EBT Growth (1y) % EBT 1y % (Qtr) -1.10 12.44
EPS Growth (1y) % EPS 1y % (Qtr) 8.59 24.35
FCF Growth (1y) % FCF 1y % (Qtr) -25.00 -146.22
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -7.03 10.16
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.46 0.36
Cash Payout Ratio Cash Payout (Qtr) 0.16 0.12
Cash Ratio Cash Ratio (Qtr) 0.10 0.15
Current Ratio Curr Ratio (Qtr) 0.78 0.94
Debt to Equity Ratio Debt/Equity (Qtr) 1.44 3.58
Interest Cover Ratio Int Coverage (Qtr) 2.50 3.17
Times Interest Earned Times Interest Earned (Qtr) 2.50 3.17
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 22.00 32.74
EBIT Margin % EBIT Margin % (Qtr) 14.31 21.43
EBT Margin % EBT Margin % (Qtr) 8.58 13.06
Gross Margin % Gross Margin % (Qtr) 49.00 43.32
Net Profit Margin % Net Margin % (Qtr) 8.20 9.98