NYSE:ATO

Stock Analysis Report

Executive Summary

Atmos Energy Corporation, together with its subsidiaries, engages in the regulated natural gas distribution, and pipeline and storage businesses in the United States.


Snowflake Analysis

Solid track record established dividend payer.


Similar Companies

Share Price & News

How has Atmos Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ATO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

9.8%

ATO

13.9%

US Gas Utilities

5.3%

US Market


1 Year Return

-2.3%

ATO

-19.2%

US Gas Utilities

-10.7%

US Market

Return vs Industry: ATO exceeded the US Gas Utilities industry which returned -19.2% over the past year.

Return vs Market: ATO exceeded the US Market which returned -10.7% over the past year.


Shareholder returns

ATOIndustryMarket
7 Day9.8%13.9%5.3%
30 Day-8.1%-5.4%-13.6%
90 Day-10.2%-17.2%-19.8%
1 Year-0.4%-2.3%-16.9%-19.2%-8.9%-10.7%
3 Year32.1%23.9%-2.1%-9.5%15.5%8.0%
5 Year100.7%79.0%38.7%21.1%35.2%20.4%

Price Volatility Vs. Market

How volatile is Atmos Energy's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Atmos Energy undervalued compared to its fair value and its price relative to the market?

22.18x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ATO ($99.15) is trading above our estimate of fair value ($55.95)

Significantly Below Fair Value: ATO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ATO is poor value based on its PE Ratio (22.2x) compared to the Gas Utilities industry average (21.7x).

PE vs Market: ATO is poor value based on its PE Ratio (22.2x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: ATO is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: ATO is overvalued based on its PB Ratio (2x) compared to the US Gas Utilities industry average (1.8x).


Next Steps

Future Growth

How is Atmos Energy forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

11.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ATO's forecast earnings growth (11% per year) is above the savings rate (1.7%).

Earnings vs Market: ATO's earnings (11% per year) are forecast to grow slower than the US market (12.3% per year).

High Growth Earnings: ATO's earnings are forecast to grow, but not significantly.

Revenue vs Market: ATO's revenue (9% per year) is forecast to grow faster than the US market (7.2% per year).

High Growth Revenue: ATO's revenue (9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ATO's Return on Equity is forecast to be low in 3 years time (9.2%).


Next Steps

Past Performance

How has Atmos Energy performed over the past 5 years?

13.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ATO has high quality earnings.

Growing Profit Margin: ATO's current net profit margins (18.3%) are higher than last year (14.4%).


Past Earnings Growth Analysis

Earnings Trend: ATO's earnings have grown by 13.8% per year over the past 5 years.

Accelerating Growth: ATO's earnings growth over the past year (19.2%) exceeds its 5-year average (13.8% per year).

Earnings vs Industry: ATO earnings growth over the past year (19.2%) exceeded the Gas Utilities industry 8%.


Return on Equity

High ROE: ATO's Return on Equity (8.7%) is considered low.


Next Steps

Financial Health

How is Atmos Energy's financial position?


Financial Position Analysis

Short Term Liabilities: ATO's short term assets ($812.1M) do not cover its short term liabilities ($845.2M).

Long Term Liabilities: ATO's short term assets ($812.1M) do not cover its long term liabilities ($7.4B).


Debt to Equity History and Analysis

Debt Level: ATO's debt to equity ratio (70.5%) is considered high.

Reducing Debt: ATO's debt to equity ratio has reduced from 100.6% to 70.5% over the past 5 years.

Debt Coverage: ATO's debt is well covered by operating cash flow (22.6%).

Interest Coverage: ATO's interest payments on its debt are well covered by EBIT (7.8x coverage).


Balance Sheet

Inventory Level: ATO has a high level of physical assets or inventory.

Debt Coverage by Assets: ATO's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Atmos Energy's current dividend yield, its reliability and sustainability?

2.32%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: ATO's dividend (2.32%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: ATO's dividend (2.32%) is low compared to the top 25% of dividend payers in the US market (5.37%).


Stability and Growth of Payments

Stable Dividend: ATO's dividends per share have been stable in the past 10 years.

Growing Dividend: ATO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (48.1%), ATO's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ATO's dividends in 3 years are forecast to be well covered by earnings (49% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.9yrs

Average management tenure


CEO

Kevin Akers (56yo)

0.50

Tenure

US$7,855,539

Compensation

Mr. John Kevin Akers, also known as Kevin, has been President, Chief Executive Officer and Director of Atmos Energy Corporation since October 1, 2019. Mr. Akers served as Executive Vice President of Safety ...


CEO Compensation Analysis

Compensation vs Market: Kevin's total compensation ($USD7.86M) is below average for companies of similar size in the US market ($USD11.77M).

Compensation vs Earnings: Kevin's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Kim Cocklin
Executive Chairman of the Board2.5yrsUS$5.88m0.36% $44.0m
John Akers
CEO, President & Director0.50yrUS$7.86m0.037% $4.5m
Christopher Forsythe
Senior VP & CFO3.17yrsUS$2.16m0.021% $2.5m
David Park
Senior Vice President of Utility Operations3.25yrsUS$1.85m0.010% $1.3m
Richard Gius
VP & Chief Information Officer12.5yrsno datano data
Jennifer Hills
Vice President of Investor Relationsno datano datano data
Karen Hartsfield
Senior VP2.67yrsno data0.0039% $478.0k
Liz Beauchamp
Vice President of Governmental & Public Affairs2.67yrsno datano data
John Robbins
Senior Vice President of Human Resources3.25yrsno data0.0072% $867.5k
Jeffrey Knights
Senior Vice President of Technical & Operating Services1.67yrsno datano data

2.9yrs

Average Tenure

51yo

Average Age

Experienced Management: ATO's management team is considered experienced (2.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Kim Cocklin
Executive Chairman of the Board2.5yrsUS$5.88m0.36% $44.0m
John Akers
CEO, President & Director0.50yrUS$7.86m0.037% $4.5m
Robert Best
Independent Director23.25yrsUS$250.00k0.51% $61.9m
Richard Ware
Independent Director26.25yrsUS$250.00k0.015% $1.8m
Nancy Quinn
Independent Director15.67yrsUS$262.51kno data
Richard Gordon
Lead Director4.17yrsUS$279.01k0.0082% $992.4k
Stephen Springer
Director14.58yrsUS$250.00k0.00082% $99.5k
Denise Bunkley
Member of the Customer Advisory Boardno datano datano data
Robert Grable
Independent Director10.92yrsUS$260.00k0.0063% $759.5k
Richard Sampson
Independent Director7.92yrsUS$265.00k0.0024% $297.2k

10.9yrs

Average Tenure

70yo

Average Age

Experienced Board: ATO's board of directors are seasoned and experienced ( 10.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6%.


Top Shareholders

Company Information

Atmos Energy Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Atmos Energy Corporation
  • Ticker: ATO
  • Exchange: NYSE
  • Founded: 1906
  • Industry: Gas Utilities
  • Sector: Utilities
  • Market Cap: US$12.133b
  • Shares outstanding: 122.27m
  • Website: https://www.atmosenergy.com

Number of Employees


Location

  • Atmos Energy Corporation
  • Three Lincoln Centre
  • Suite 1800
  • Dallas
  • Texas
  • 75240
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ATONYSE (New York Stock Exchange)YesCommon SharesUSUSDNov 1983
AEODB (Deutsche Boerse AG)YesCommon SharesDEEURNov 1983
AEOCHFBRSE (Berne Stock Exchange)YesCommon SharesCHCHFNov 1983
A1TM34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 COMBRBRLJan 2020

Biography

Atmos Energy Corporation, together with its subsidiaries, engages in the regulated natural gas distribution, and pipeline and storage businesses in the United States. It operates through Distribution, and Pipeline and Storage segments. The Distribution segment is involved in the regulated natural gas distribution and related sales operations in eight states. This segment distributes natural gas to approximately three million residential, commercial, public authority, and industrial customers. As of September 30, 2019, it owned 70,875 miles of underground distribution and transmission mains. The Pipeline and Storage segment engages in the pipeline and storage operations. This segment transports natural gas for third parties and manages five underground storage reservoirs in Texas; and provides ancillary services to the pipeline industry, including parking arrangements, lending, and inventory sales. It owns 5,669 miles of gas transmission lines. The company was founded in 1906 and is headquartered in Dallas, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 10:11
End of Day Share Price2020/03/31 00:00
Earnings2019/12/31
Annual Earnings2019/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.