Stock of the Day

Atmos Energy (ATO)

$152.11

-$0.25 (-0.2%)

Market Cap: $24.18B

About Atmos Energy

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 two segments, Distribution, and Pipeline and Storage.

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 3.3 million residential, commercial, public authority, and industrial customers; and owned 73,689 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 facilities in Texas; provides ancillary services customary to the pipeline industry, including parking arrangements, lending, and inventory sales; and owned 5,645 miles of gas transmission lines. Atmos Energy Corporation was founded in 1906 and is headquartered in Dallas, Texas.

Atmos Energy Bull Case

Here are some ways that investors could benefit from investing in Atmos Energy Co.:

• The current stock price is around $154, which reflects a stable market position and potential for growth.
• Recent analyst upgrades indicate positive sentiment, with several firms raising their price targets and issuing "strong-buy" ratings.
• Institutional investors hold a significant majority of the stock, with over 90% ownership, suggesting confidence in the company's long-term prospects.
• The company has demonstrated consistent financial performance, with a market capitalization of approximately $24.5 billion, indicating a solid foundation for future growth.
• Atmos Energy Co. has a relatively low beta of 0.74, suggesting that its stock is less volatile compared to the market, which can be appealing for risk-averse investors.

Atmos Energy Bear Case

Investors should be bearish about investing in Atmos Energy Co. for these reasons:

• The price-to-earnings ratio is around 22, which may indicate that the stock is overvalued compared to its earnings, potentially limiting upside for new investors.
• Recent downgrades from some analysts, including a shift from "outperform" to "neutral," suggest mixed opinions on the stock's future performance.
• The company has a price-to-earnings-growth ratio of 2.94, which may indicate that the stock is expensive relative to its growth rate, raising concerns about future returns.
• Market fluctuations and economic uncertainties could impact the utility sector, affecting Atmos Energy Co.'s performance and stock price.
• Despite a strong institutional backing, the high concentration of ownership could lead to volatility if large stakeholders decide to sell their positions.