ATMOS ENERGY CORP (ATO) Stock Fundamental Analysis
NYSE:ATO - New York Stock Exchange, Inc. - US0495601058 - Common Stock - Currency: USD
Overall ATO gets a fundamental rating of 5 out of 10. We evaluated ATO against 14 industry peers in the Gas Utilities industry. While ATO has a great profitability rating, there are some minor concerns on its financial health. ATO is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
ATO had positive earnings in the past year.
In the past year ATO had a positive cash flow from operations.
ATO had positive earnings in each of the past 5 years.
Of the past 5 years ATO 4 years had a positive operating cash flow.
1.2 Ratios
ATO has a better Return On Assets (5.26%) than 92.86% of its industry peers.
ATO has a Return On Equity of 10.91%. This is in the better half of the industry: ATO outperforms 71.43% of its industry peers.
ATO has a better Return On Invested Capital (6.20%) than 64.29% of its industry peers.
ATO had an Average Return On Invested Capital over the past 3 years of 4.48%. This is below the industry average of 7.79%.
The 3 year average ROIC (4.48%) for ATO is below the current ROIC(6.20%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.26% | ||
| ROE | 10.91% | ||
| ROIC | 6.2% |
ROA(3y)3.85%
ROA(5y)3.77%
ROE(3y)8.31%
ROE(5y)8.44%
ROIC(3y)4.48%
ROIC(5y)4.64%
1.3 Margins
ATO has a Profit Margin of 26.10%. This is amongst the best in the industry. ATO outperforms 100.00% of its industry peers.
ATO's Profit Margin has improved in the last couple of years.
ATO's Operating Margin of 33.98% is amongst the best of the industry. ATO outperforms 85.71% of its industry peers.
ATO's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 78.14%, ATO belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
In the last couple of years the Gross Margin of ATO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.98% | ||
| PM (TTM) | 26.1% | ||
| GM | 78.14% |
OM growth 3Y7%
OM growth 5Y4.82%
PM growth 3Y8.64%
PM growth 5Y7.28%
GM growth 3Y3.64%
GM growth 5Y1.96%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ATO is destroying value.
The number of shares outstanding for ATO has been increased compared to 1 year ago.
ATO has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, ATO has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.72, we must say that ATO is in the distress zone and has some risk of bankruptcy.
ATO has a Altman-Z score of 1.72. This is amongst the best in the industry. ATO outperforms 100.00% of its industry peers.
A Debt/Equity ratio of 0.66 indicates that ATO is somewhat dependend on debt financing.
The Debt to Equity ratio of ATO (0.66) is better than 92.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.72 |
ROIC/WACC0.81
WACC7.69%
2.3 Liquidity
A Current Ratio of 1.56 indicates that ATO should not have too much problems paying its short term obligations.
ATO has a better Current ratio (1.56) than 100.00% of its industry peers.
A Quick Ratio of 1.43 indicates that ATO should not have too much problems paying its short term obligations.
ATO's Quick ratio of 1.43 is amongst the best of the industry. ATO outperforms 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
ATO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.95%, which is quite good.
ATO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.37% yearly.
The Revenue has grown by 35.23% in the past year. This is a very strong growth!
ATO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.50% yearly.
EPS 1Y (TTM)10.95%
EPS 3Y9.85%
EPS 5Y9.37%
EPS Q2Q%7.21%
Revenue 1Y (TTM)35.23%
Revenue growth 3Y6.92%
Revenue growth 5Y7.5%
Sales Q2Q%1.51%
3.2 Future
ATO is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.38% yearly.
The Revenue is expected to grow by 7.41% on average over the next years.
EPS Next Y6%
EPS Next 2Y6.99%
EPS Next 3Y7.24%
EPS Next 5Y7.38%
Revenue Next Year3.77%
Revenue Next 2Y7.44%
Revenue Next 3Y7.53%
Revenue Next 5Y7.41%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
ATO is valuated rather expensively with a Price/Earnings ratio of 21.26.
Based on the Price/Earnings ratio, ATO is valued a bit more expensive than 71.43% of the companies in the same industry.
ATO's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 29.35.
Based on the Price/Forward Earnings ratio of 18.98, the valuation of ATO can be described as rather expensive.
Based on the Price/Forward Earnings ratio, ATO is valued a bit more expensive than the industry average as 64.29% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of ATO to the average of the S&P500 Index (22.10), we can say ATO is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.26 | ||
| Fwd PE | 18.98 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ATO is valued more expensive than 85.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.6 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ATO does not grow enough to justify the current Price/Earnings ratio.
ATO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.54
PEG (5Y)2.27
EPS Next 2Y6.99%
EPS Next 3Y7.24%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.38%, ATO has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.93, ATO's dividend is way lower than its industry peers. On top of this 85.71% of the companies listed in the same industry pay a better dividend than ATO!
ATO's Dividend Yield is comparable with the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.38% |
5.2 History
On average, the dividend of ATO grows each year by 8.76%, which is quite nice.
ATO has been paying a dividend for at least 10 years, so it has a reliable track record.
ATO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)8.76%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
ATO pays out 36.48% of its income as dividend. This is a sustainable payout ratio.
The dividend of ATO is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP36.48%
EPS Next 2Y6.99%
EPS Next 3Y7.24%
148.6
+2.25 (+1.54%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryGas Utilities
Earnings (Last)
Earnings (Next)
Inst Owners104.91%
Inst Owner Change4.59%
Ins Owners0.35%
Ins Owner Change5.69%
Market Cap23.59B
Analysts76.67
Price Target155.23 (4.46%)
Short Float %2.94%
Short Ratio5.21
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.38% |
Yearly Dividend3.25
Dividend Growth(5Y)8.76%
DP36.48%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.43%
Min EPS beat(2)0.64%
Max EPS beat(2)2.21%
EPS beat(4)4
Avg EPS beat(4)3.2%
Min EPS beat(4)0.64%
Max EPS beat(4)8.2%
EPS beat(8)6
Avg EPS beat(8)2.08%
EPS beat(12)8
Avg EPS beat(12)3.28%
EPS beat(16)11
Avg EPS beat(16)4.02%
Revenue beat(2)0
Avg Revenue beat(2)-21.42%
Min Revenue beat(2)-29.12%
Max Revenue beat(2)-13.72%
Revenue beat(4)0
Avg Revenue beat(4)-17.85%
Min Revenue beat(4)-29.12%
Max Revenue beat(4)-8.03%
Revenue beat(8)0
Avg Revenue beat(8)-23.86%
Revenue beat(12)4
Avg Revenue beat(12)-8.17%
Revenue beat(16)7
Avg Revenue beat(16)-4.63%
PT rev (1m)1.54%
PT rev (3m)2.64%
EPS NQ rev (1m)-1.53%
EPS NQ rev (3m)-2.17%
EPS NY rev (1m)0.09%
EPS NY rev (3m)0.5%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.17%
Revenue NY rev (1m)-0.54%
Revenue NY rev (3m)-5.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.26 | ||
| Fwd PE | 18.98 | ||
| P/S | 4.42 | ||
| P/FCF | N/A | ||
| P/OCF | 13.32 | ||
| P/B | 1.85 | ||
| P/tB | 1.97 | ||
| EV/EBITDA | 12.6 |
EPS(TTM)6.99
EY4.7%
EPS(NY)7.83
Fwd EY5.27%
FCF(TTM)-8.12
FCFYN/A
OCF(TTM)11.15
OCFY7.51%
SpS33.65
BVpS80.52
TBVpS75.4
PEG (NY)3.54
PEG (5Y)2.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.26% | ||
| ROE | 10.91% | ||
| ROCE | 7.17% | ||
| ROIC | 6.2% | ||
| ROICexc | 6.35% | ||
| ROICexgc | 6.56% | ||
| OM | 33.98% | ||
| PM (TTM) | 26.1% | ||
| GM | 78.14% | ||
| FCFM | N/A |
ROA(3y)3.85%
ROA(5y)3.77%
ROE(3y)8.31%
ROE(5y)8.44%
ROIC(3y)4.48%
ROIC(5y)4.64%
ROICexc(3y)4.51%
ROICexc(5y)4.66%
ROICexgc(3y)4.68%
ROICexgc(5y)4.87%
ROCE(3y)5.22%
ROCE(5y)5.38%
ROICexcg growth 3Y-0.04%
ROICexcg growth 5Y-1.17%
ROICexc growth 3Y0.36%
ROICexc growth 5Y-0.68%
OM growth 3Y7%
OM growth 5Y4.82%
PM growth 3Y8.64%
PM growth 5Y7.28%
GM growth 3Y3.64%
GM growth 5Y1.96%
F-Score7
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.4 | ||
| Cap/Depr | 445.94% | ||
| Cap/Sales | 57.27% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.8% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 1.72 |
F-Score7
WACC7.69%
ROIC/WACC0.81
Cap/Depr(3y)453.01%
Cap/Depr(5y)444.29%
Cap/Sales(3y)64.77%
Cap/Sales(5y)64.15%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)10.95%
EPS 3Y9.85%
EPS 5Y9.37%
EPS Q2Q%7.21%
EPS Next Y6%
EPS Next 2Y6.99%
EPS Next 3Y7.24%
EPS Next 5Y7.38%
Revenue 1Y (TTM)35.23%
Revenue growth 3Y6.92%
Revenue growth 5Y7.5%
Sales Q2Q%1.51%
Revenue Next Year3.77%
Revenue Next 2Y7.44%
Revenue Next 3Y7.53%
Revenue Next 5Y7.41%
EBIT growth 1Y58.49%
EBIT growth 3Y14.41%
EBIT growth 5Y12.68%
EBIT Next Year66.86%
EBIT Next 3Y29.23%
EBIT Next 5Y23.63%
FCF growth 1Y11.23%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y60.27%
OCF growth 3YN/A
OCF growth 5Y12.34%