Atmos Energy Corp

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ATO : NYSE : Utilities
$75.91 -0.76 | -0.99%
Today's Range: 75.78 - 77.13
Avg. Daily Volume: 447,900
09/27/16 - 4:03 PM ET

Financial Analysis


ATMOS ENERGY CORP's gross profit margin for the third quarter of its fiscal year 2016 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. ATMOS ENERGY CORP has very weak liquidity. Currently, the Quick Ratio is 0.22 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 7.05% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)632.92686.4
EBITDA ($mil)210.62186.05
EBIT ($mil)137.16117.61
Net Income ($mil)71.1956.28


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)66.2143.15
Total Assets ($mil)9727.378884.49
Total Debt ($mil)3126.112707.28
Equity ($mil)3466.723238.26


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin33.2827.11
EBITDA Margin33.2727.1
Operating Margin21.6717.13
Sales Turnover0.340.48
Return on Assets3.483.54
Return on Equity9.789.73
Debt Q3 FY16 Q3 FY15
Current Ratio0.420.67
Debt/Capital0.470.46
Interest Expense27.727.96
Interest Coverage4.954.21


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)103.83101.34
Div / share0.420.39
EPS0.690.55
Book value / share33.3931.96
Institutional Own % n/a n/a
Avg Daily Volume448745.0543112.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 37.69 for the Gas Utilities industry and a value on par with the S&P 500 average of 25.19. For additional comparison, its price-to-book ratio of 2.33 indicates a discount versus the S&P 500 average of 2.82 and a discount versus the industry average of 3.46. The current price-to-sales ratio is above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, ATMOS ENERGY CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ATO 23.53 Peers 37.69   ATO 10.82 Peers 11.08

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ATO is trading at a significant discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ATO is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ATO 22.12 Peers 25.62   ATO 3.47 Peers 2.26

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

ATO is trading at a valuation on par with its peers.

 

Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ATO trades at a significant premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ATO 2.33 Peers 3.46   ATO 6.79 Peers -23.01

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ATO is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

ATO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ATO 2.42 Peers 2.22   ATO -21.95 Peers -17.39

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ATO is trading at a valuation on par with its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ATO significantly trails its peers on the basis of sales growth

 

 

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