ATMOS ENERGY CORP (ATO) Stock Fundamental Analysis
NYSE:ATO - New York Stock Exchange, Inc. - US0495601058 - Common Stock - Currency: USD
Taking everything into account, ATO scores 5 out of 10 in our fundamental rating. ATO was compared to 14 industry peers in the Gas Utilities industry. While ATO belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ATO has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year ATO was profitable.
ATO had a positive operating cash flow in the past year.
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's Return On Assets of 4.21% is amongst the best of the industry. ATO outperforms 85.71% of its industry peers.
With a Return On Equity value of 8.65%, ATO perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 5.01%, ATO is in line with its industry, outperforming 42.86% of the companies in the same industry.
ATO had an Average Return On Invested Capital over the past 3 years of 4.48%. This is in line with the industry average of 6.29%.
The last Return On Invested Capital (5.01%) for ATO is above the 3 year average (4.48%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.21% | ||
| ROE | 8.65% | ||
| ROIC | 5.01% |
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 25.33%. 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.
With an excellent Operating Margin value of 33.30%, ATO belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
ATO's Operating Margin has improved in the last couple of years.
ATO has a better Gross Margin (78.07%) than 78.57% of its industry peers.
In the last couple of years the Gross Margin of ATO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.3% | ||
| PM (TTM) | 25.33% | ||
| GM | 78.07% |
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
ATO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for ATO has been increased compared to 1 year ago.
Compared to 5 years ago, ATO has more shares outstanding
The debt/assets ratio for ATO is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.66, we must say that ATO is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of ATO (1.66) is better than 100.00% of its industry peers.
ATO has a Debt/Equity ratio of 0.65. This is a neutral value indicating ATO is somewhat dependend on debt financing.
ATO's Debt to Equity ratio of 0.65 is amongst the best of the industry. ATO outperforms 92.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.66 |
ROIC/WACC0.65
WACC7.73%
2.3 Liquidity
A Current Ratio of 1.33 indicates that ATO should not have too much problems paying its short term obligations.
ATO has a Current ratio of 1.33. This is amongst the best in the industry. ATO outperforms 100.00% of its industry peers.
ATO has a Quick Ratio of 1.25. This is a normal value and indicates that ATO is financially healthy and should not expect problems in meeting its short term obligations.
ATO has a better Quick ratio (1.25) than 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.25 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.50% over the past year.
ATO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.37% yearly.
Looking at the last year, ATO shows a very negative growth in Revenue. The Revenue has decreased by -13.97% in the last year.
ATO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.50% yearly.
EPS 1Y (TTM)7.5%
EPS 3Y9.85%
EPS 5Y9.37%
EPS Q2Q%6.32%
Revenue 1Y (TTM)-13.97%
Revenue growth 3Y6.92%
Revenue growth 5Y7.5%
Sales Q2Q%18.41%
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.
ATO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.41% yearly.
EPS Next Y6.82%
EPS Next 2Y7.25%
EPS Next 3Y7.35%
EPS Next 5Y7.38%
Revenue Next Year1.64%
Revenue Next 2Y7.13%
Revenue Next 3Y7.26%
Revenue Next 5Y7.41%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 21.24.
71.43% of the companies in the same industry are cheaper than ATO, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.45, ATO is valued a bit cheaper.
With a Price/Forward Earnings ratio of 19.35, ATO is valued on the expensive side.
Based on the Price/Forward Earnings ratio, ATO is valued expensively inside the industry as 85.71% of the companies are valued cheaper.
The average S&P500 Price/Forward Earnings ratio is at 21.89. ATO is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.24 | ||
| Fwd PE | 19.35 |
4.2 Price Multiples
92.86% of the companies in the same industry are cheaper than ATO, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.63 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
ATO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.11
PEG (5Y)2.27
EPS Next 2Y7.25%
EPS Next 3Y7.35%
5. Dividend
5.1 Amount
ATO has a Yearly Dividend Yield of 2.29%.
Compared to an average industry Dividend Yield of 3.98, 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 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.29% |
5.2 History
The dividend of ATO is nicely growing with an annual growth rate of 8.76%!
ATO has been paying a dividend for at least 10 years, so it has a reliable track record.
ATO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.76%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
46.22% of the earnings are spent on dividend by ATO. This is a bit on the high side, but may be sustainable.
ATO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP46.22%
EPS Next 2Y7.25%
EPS Next 3Y7.35%
152.28
+0.77 (+0.51%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryGas Utilities
Earnings (Last)
Earnings (Next)
Inst Owners107.28%
Inst Owner Change-54.01%
Ins Owners0.35%
Ins Owner Change4.9%
Market Cap24.19B
Analysts73.68
Price Target165.79 (8.87%)
Short Float %3.56%
Short Ratio5.1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.29% |
Yearly Dividend3.25
Dividend Growth(5Y)8.76%
DP46.22%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.52%
Min EPS beat(2)0.64%
Max EPS beat(2)4.39%
EPS beat(4)4
Avg EPS beat(4)2.25%
Min EPS beat(4)0.64%
Max EPS beat(4)4.39%
EPS beat(8)7
Avg EPS beat(8)2.67%
EPS beat(12)9
Avg EPS beat(12)3.66%
EPS beat(16)11
Avg EPS beat(16)3.59%
Revenue beat(2)1
Avg Revenue beat(2)-3.8%
Min Revenue beat(2)-13.72%
Max Revenue beat(2)6.12%
Revenue beat(4)1
Avg Revenue beat(4)-14.31%
Min Revenue beat(4)-29.12%
Max Revenue beat(4)6.12%
Revenue beat(8)1
Avg Revenue beat(8)-21.08%
Revenue beat(12)4
Avg Revenue beat(12)-9.09%
Revenue beat(16)7
Avg Revenue beat(16)-5.52%
PT rev (1m)2.65%
PT rev (3m)6.03%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.14%
EPS NY rev (1m)0.35%
EPS NY rev (3m)0.72%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.37%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.24 | ||
| Fwd PE | 19.35 | ||
| P/S | 5.39 | ||
| P/FCF | N/A | ||
| P/OCF | 12.42 | ||
| P/B | 1.84 | ||
| P/tB | 1.96 | ||
| EV/EBITDA | 14.63 |
EPS(TTM)7.17
EY4.71%
EPS(NY)7.87
Fwd EY5.17%
FCF(TTM)-8.22
FCFYN/A
OCF(TTM)12.26
OCFY8.05%
SpS28.24
BVpS82.71
TBVpS77.61
PEG (NY)3.11
PEG (5Y)2.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.21% | ||
| ROE | 8.65% | ||
| ROCE | 5.79% | ||
| ROIC | 5.01% | ||
| ROICexc | 5.12% | ||
| ROICexgc | 5.29% | ||
| OM | 33.3% | ||
| PM (TTM) | 25.33% | ||
| GM | 78.07% | ||
| 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-Score4
Asset Turnover0.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.86 | ||
| Cap/Depr | 462.29% | ||
| Cap/Sales | 72.5% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 88.6% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.25 | ||
| Altman-Z | 1.66 |
F-Score4
WACC7.73%
ROIC/WACC0.65
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)7.5%
EPS 3Y9.85%
EPS 5Y9.37%
EPS Q2Q%6.32%
EPS Next Y6.82%
EPS Next 2Y7.25%
EPS Next 3Y7.35%
EPS Next 5Y7.38%
Revenue 1Y (TTM)-13.97%
Revenue growth 3Y6.92%
Revenue growth 5Y7.5%
Sales Q2Q%18.41%
Revenue Next Year1.64%
Revenue Next 2Y7.13%
Revenue Next 3Y7.26%
Revenue Next 5Y7.41%
EBIT growth 1Y-10.7%
EBIT growth 3Y14.41%
EBIT growth 5Y12.68%
EBIT Next Year69.82%
EBIT Next 3Y29.9%
EBIT Next 5Y23.67%
FCF growth 1Y-333.1%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-39.72%
OCF growth 3YN/A
OCF growth 5Y12.34%