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Why Is Atmos (ATO) Up 1.1% Since Last Earnings Report?

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A month has gone by since the last earnings report for Atmos Energy (ATO - Free Report) . Shares have added about 1.1% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Atmos due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Atmos Energy Q4 Earnings Outpace Estimates

Atmos Energy posted fourth-quarter fiscal 2024 earnings of 86 cents per share, which beat the Zacks Consensus Estimate of 84 cents by 2.4%. The bottom line also improved 7.5% from the year-ago quarter’s 80 cents.

The company posted full-year fiscal 2024 earnings of $6.83 per share, up 12% from last year’s $6.10.

ATO’s Segment Details

Distribution: Operating income totaled $64.6 million, highlighting a 19.9% increase from $53.9 million in the year-ago quarter.

Pipeline and Storage: Operating income amounted to $120.4 million, reflecting a 20.2% increase from $100.2 million in the year-ago quarter.

Highlights of ATO’s Earnings Release

Operation and maintenance expenses, excluding bad debt expenses for fiscal 2024, amounted to $815 million, up 6.5% from the year-ago level.

Operating income totaled $1.36 billion, up 27% from that recorded a year ago.

ATO’s Financial Highlights

As of Sept. 30, 2024, Atmos Energy reported a strong balance sheet with approximately $4.8 billion available liquidity. This represents $307 million of cash available as of the same date.

In fiscal 2024, the company invested nearly $2.94 billion, up 4.7% from the year-ago level.

ATO’s Guidance

Atmos Energy expects its fiscal 2025 earnings to be in the range of $7.05-$7.25 per share. The Zacks Consensus Estimate is pegged at $7.16 per share, higher than the midpoint of the company’s guided range.

Total net income is expected to be in the range of $1.12-$1.15 billion.

ATO also anticipates its fiscal 2025 capital expenditure to be $3.7 billion.

 

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month.

VGM Scores

Currently, Atmos has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Atmos has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry Player

Atmos belongs to the Zacks Utility - Gas Distribution industry. Another stock from the same industry, ONE Gas (OGS - Free Report) , has gained 1.7% over the past month. More than a month has passed since the company reported results for the quarter ended September 2024.

ONE Gas reported revenues of $340.4 million in the last reported quarter, representing a year-over-year change of +1.4%. EPS of $0.34 for the same period compares with $0.45 a year ago.

ONE Gas is expected to post earnings of $1.27 per share for the current quarter, representing no change from the year-ago quarter. Over the last 30 days, the Zacks Consensus Estimate has changed +4.7%.

ONE Gas has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.


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