UGI (UGI): Reassessing Valuation After a Strong Year-to-Date Share Price Rally
UGI has been quietly grinding higher this year, and that steady climb is starting to catch more investor attention. With shares up roughly 33% year to date, the stock’s move invites a closer look.
See our latest analysis for UGI.
The recent 10.3% 1 month share price return, on top of a 33.5% year to date share price gain and a 38.0% 1 year total shareholder return, suggests momentum is building as investors reassess UGI’s earnings resilience and valuation.
If UGI’s steady climb has you rethinking your portfolio, this could be a good moment to broaden your watchlist and explore fast growing stocks with high insider ownership.
With earnings growing, a value score at the top of the scale, and shares still trading below analyst targets and intrinsic value estimates, is UGI a mispriced opportunity, or is the market already discounting its future growth?
Most Popular Narrative Narrative: 12.2% Undervalued
Against a last close of $37.75, the most followed narrative pegs UGI’s fair value closer to $43, implying upside that the recent rally has not fully closed.
Divestiture of non core, low margin LPG assets and redeployment of proceeds into higher return, regulated utility and energy services businesses enable greater financial flexibility, prudent deleveraging, and improved overall earnings quality.
Want to see how modest growth assumptions, firmer margins, and a lower future earnings multiple still add up to a higher value? The full narrative unpacks the cash flow math behind that conclusion, step by step, and reveals which long term profitability shift does most of the heavy lifting.
Result: Fair Value of $43 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, structural shifts away from fossil fuels, along with rising infrastructure and regulatory costs, could erode UGI’s margins faster than analysts currently expect.
Find out about the key risks to this UGI narrative.
Build Your Own UGI Narrative
If you see things differently or want to stress test the assumptions with your own inputs, you can build a custom view in minutes: Do it your way.
A great starting point for your UGI research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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