UGI Story

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UGI -- USA Stock  

USD 31.98  0.17  0.53%

UGI Corporation is scheduled to announce its earnings tomorrow. The upcoming quarterly report is expected on the 3rd of August 2020. UGI Earnings Before Interest Taxes and Depreciation Amortization EBITDA are most likely to increase significantly in the upcoming years. The last year's value of Earnings Before Interest Taxes and Depreciation Amortization EBITDA was reported at 982.53 Million. The current Average Equity is estimated to increase to about 2.8 B, while Average Assets are projected to decrease to roughly 7.9 B. As many baby boomers are still indifferent towards utilities space, it makes sense to concentrate on UGI Corporation as a unique choice for millenniums. We will check if the company can maintain a respectable level of debt while minimizing operating losses.
Published over a month ago
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You think UGI (NYSE:UGI) debt is an issue for stockholders?
UGI Corporation has 6.92 B in debt with debt to equity (D/E) ratio of 1.69, which is OK given its current industry classification. On a scale of 0 to 100, UGI holds a performance score of 5. The entity has a beta of -0.0706, which indicates not very significant fluctuations relative to the market. Let's try to break down what UGI's beta means in this case. As returns on the market increase, returns on owning UGI are expected to decrease at a much lower rate. During the bear market, UGI is likely to outperform the market. Although it is vital to follow UGI Corporation current price movements, it is good to be conservative about what you can do with the information regarding equity historical returns. The approach towards measuring future performance of any stock is to evaluate the business as a whole together with its past performance, including all available fundamental and technical indicators. By examining UGI Corporation technical indicators, you can now evaluate if the expected return of 0.25% will be sustainable into the future. Please operates UGI coefficient of variation, treynor ratio, as well as the relationship between the Treynor Ratio and semi variance to make a quick decision on whether UGI Corporation existing price patterns will revert.
UGI financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of UGI, including all of UGI's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of UGI assets, the company is considered highly leveraged. Understanding the composition and structure of overall UGI debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.

Understanding UGI Total Debt

UGI Corporation liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. UGI Corporation has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on UGI balance sheet include debt obligations and money owed to different UGI vendors, workers, and loan providers. Below is the chart of UGI main long-term debt accounts currently reported on its balance sheet.
You can use UGI Corporation financial leverage analysis tool to get a better grip on understanding its financial position

How important is UGI's Liquidity

UGI financial leverage refers to using borrowed capital as a funding source to finance UGI Corporation ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. UGI financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between UGI's total debt and its cash.

Exercise or conversion by John Walsh of 50000 shares of UGI subject to Rule 16b-3

Legal trades by UGI insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
UGI insider trading alert for exercise of options (right to buy) by John Walsh, President & CEO, on 16th of September 2020. This event was filed by Ugi Corp with SEC on 2020-09-16. Statement of changes in beneficial ownership - SEC Form 4. John Walsh currently serves as ceo and president executive director and member of executive committee of UGI Corporation [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Is UGI valued objectively by the market?

The entity reported the last year's revenue of 6.75 B. Total Income to common stockholders was 384.1 M with profit before taxes, overhead, and interest of 3 B.

Asset Breakdown

9.2 B
Assets Non Current
2.5 B
Current Assets
Total Assets10.58 Billion
Current Assets1.39 Billion
Assets Non Current9.15 Billion
Goodwill2.54 Billion
Tax Assets9.21 Million

UGI is estimated to stay under $34 in September

UGI sortino ratio is up to 0.01. As of the 2nd of August, UGI has the risk adjusted performance of 0.1103, and Coefficient Of Variation of 1539.59. In connection with fundamental indicators, the technical analysis model makes it possible for you to check practical technical drivers of UGI Corporation, as well as the relationship between them. In other words, you can use this information to find out if the company will indeed mirror its model of past prices and volume data, or the prices will eventually revert. We were able to break down nineteen technical drivers for UGI Corporation, which can be compared to its competition. Please validate UGI Corporation coefficient of variation, treynor ratio, as well as the relationship between the Treynor Ratio and semi variance to decide if UGI is priced adequately, providing market reflects its prevalent price of 33.34 per share. Given that UGI Corporation has jensen alpha of 0.2052, we advise you to double-check UGI Corporation's current market performance to make sure the company can sustain itself at some point in the future.

Our Final Take On UGI

While some companies in the utilities?regulated gas industry are either recovering or due for a correction, UGI may not be as strong as the others in terms of longer-term growth potentials. The inconsistency in the assessment between current UGI valuation and our trade advice on UGI is due to the recent market swings and your selection of investing horizon. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to UGI.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of UGI Corporation. Please refer to our Terms of Use for any information regarding our disclosure principles.

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