ATO: Higher Dividend And Earnings Guidance Will Shape Balanced Future Outlook

Analysts have increased their price target for Atmos Energy slightly to approximately $176 per share from about $175, citing a modest improvement in expected profit margins that more than offsets slightly lower projected revenue growth and a marginally cheaper forward valuation.

What's in the News

• Atmos Energy shareholders will vote at the February 4, 2026 AGM on amendments to the articles of incorporation, including an increase in authorized common shares, adoption of plurality voting in contested director elections, updates to officer liability limits under Texas and Virginia law, and clarified indemnification and other technical changes (company filing).
• The Board of Directors approved an increase in the quarterly dividend on common stock to $1.00 per share, payable December 8, 2025 to shareholders of record on November 24, 2025, marking the 168th consecutive quarterly dividend and lifting the indicated annual dividend for fiscal 2026 to $4.00 from $3.48 in fiscal 2025 (company announcement).
• Atmos Energy issued fiscal 2026 earnings guidance, projecting earnings per diluted share in a range of 8.15 to 8.35 (company guidance).

Valuation Changes

• The fair value estimate has risen slightly to approximately $175.73 from about $175.27 per share, reflecting a modest upward revision.
• The discount rate is essentially unchanged, edging down fractionally from 6.956 percent to 6.956 percent, indicating a stable risk assessment.
• Revenue growth has eased slightly, with the long term annual growth assumption reduced from roughly 10.16 percent to about 9.96 percent.
• The net profit margin has risen modestly, improving from about 26.72 percent to roughly 27.06 percent, supporting a somewhat higher earnings outlook.
• The future P/E multiple has inched down slightly to about 21.60 times from roughly 21.70 times, implying a marginally lower forward valuation multiple.