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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Atmos Energy Corporation (XNYS:ATO) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
ATO
Name:
ATMOS ENERGY CORPORATION (XNYS:ATO)
Sector:
- 622356.00K
Industry:
Utilities�Regulated Gas
CEO:
Mr. John Akers
Total Employees:
4,684
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 95.38% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF ATMOS ENERGY CORPORATION(ATO) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND UTILITIES�REGULATED GAS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
114.55
One Month Price Target:
$114.88
Six Month Price Target :
$116.53
Likely Price in One Year's Time:
Ticker:
$118.5
Likely Trading Range Today Under (Normal Volatility)
$114.22
Price Upper limit ($) :
$114.95
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$110.18
This week:
$104.77
This month :
$94.99
Other Primary facts
Market Cap:
15.98B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
139.89M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.38%
-12.5%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$134.85
$125.55
$94.25
$103.55
Medium risk (<10%) entry points
Buy Call
Sell Call
$122.52
Buy Put:
Sell Put:
$120.54
$106.55
$108.56
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
ATO
Sharpe Ratio:
0.97%
Comparison:
ATO, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -53.31% lower than the industry
& is -57.26% lower than the market/S&P 500 average
Average Returns/Yield of
ATO
Daily returns:
0.03%
Weekly returns:
0.14%
Monthly returns:
0.54%
Yearly returns:
20.89%
Comparison of returns:
Average annual returns/yield (last 3 years) is -68.88% below industry average
Classification:
ATO, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.74
Statistical test of Returns:
ATO has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
1.87%
Weekly Volatility:
4.19%
Monthly Volatility:
8.37%
Yearly Volatility:
29.00%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.23%
Volatility in last five trading days has been -34.12% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-3.82%
Weekly VaR:
-8.54%
Monthly VaR:
-17.07%
How Much Can the price of
ATO
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-15%
Worst case (decline):
-59.14%
This translates to price declining to:
$97.61
This translates to price declining to:
$46.80
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
ATO is a 20.50% riskier investment compared to the market/S&P 500 & is 3.24% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -29.30% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
ATO
Beta in relation to market/S&P 500--0.51
Expected beta in 1 year's time:
0.515
Expected beta in 3 year's time:
0.728
Unlevered (debt free) Beta:
0.514
Beta in relation to Nasdaq (XNAS):
0.427
Beta in relation to all global stocks::
0.68
Beta Comparison & Analysis
Beta of competitors/peers::
0.67
Beta is -23.33% lower than peers
Average Industry Beta:
0.86
Beta is -40.26% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
4.84%
Sustainable growth rate is -34.94% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.002
Alpha is -101.42% below industry average alpha yield
Alpha is -11% below the market average
Analysis of Cost of Capital of
ATO
Equity cost of capital:
0.067
Equity cost of capital is -26.23% below industry mean WACC
Unlevered (without debt) cost of capital:
6.67%
Before-tax cost of debt:
0.81%
After-tax cost of debt:
0.64%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.64%
WACC is -29.09% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$27.14
Revenue growth rate per share of (3Y):
0.75
Annual revenue growth rate is -81.40% below industry average
EPS:
$5.34
Expected Annual growth rate of EPS (3Y):
6.39%
Expected future EPS growth rate is -72.90% lower than the Utilities�Regulated Gas industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: 28.92%
Equity growth rate per share is 1100.06% higher than the industry
Debt per share
$39.71
EBITDA per share
$9.70
Valuation Analysis Today of
ATO
P/E Ratio:
20.91
P/E Ratio of Competitors/Peers:
19.62
P/E ratio is 6.56% higher than main peers & is 59.21% higher than the industry
Stock price/value with industry average P/E ratio: $70.12
ATO is 63.35% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $77.54
Present value of the expected future dividends only: $55.13
P/S (Price to Sales ratio):
4.22
Price to sales ratio is 23.84% above the industry mean
P/B (Price to book value ratio):
0.75
-
-
Net income growth rate (3Y):
-5.60%
Net income growth rate is -98.11% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 13.79%
Dividend yeild: 2.33%
Previous Dividend: $0.68
Previous adjusted dividend: $0.68
Previous Dividend: $2.67
Expected next dividend best case: $0.72
Expected next dividend worst case: $0.64
Average dividend payment (long-term): $0.62
Average dividend increase/decrease (growth rate) % per period: 1.75%
Expected next dividend payment date: 09/05/2022
Expected next dividend record date: 22/08/2022
Expected next dividend declaration date: 08/02/2022
Previous dividend payment date: 06/06/2022
Previous dividend record date: 23/05/2022
Previous dividend declaration date: 05/04/2022
Dividend History:
2022-05-20--$0.68
2021-11-26--$0.68
2021-05-21--$0.63
2022-02-17--$0.68
2021-08-20--$0.63
2021-02-19--$0.63
Dividend growth rate is -108.29% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
0.00%
Net debt to equity ratio:
-
Debt to assets ratio:
25.87%
Net debt to assets ratio:
35.82%
Debt-to-asset ratio is -50.95% below industry average
Ability to repay debt:
Interest coverage ratio:
21.09
Interest coverage ratio is 284.09% more than industry average
Looking forward:
Debt growth rate:
65.89%
Annual debt growth is -21% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.585
Statistical significance of correlation:
ATO has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.552
Stock price is 6.02% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.552
Correlation of price movement with Nasdaq (^IXIC):
0.045
Covariance of price movement with the market:
0.049
Kurtosis
13.011
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.482
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
ATO
Gross Profit Margin Ratio:
262%
Operating Profit Margin Ratio:
23.32%
Operating profit margin is 164.21% higher than the industry
Net Profit Margin Ratio:
262%
Effective Tax Rate:
18.28%
Effective tax rate is -21.77% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.68%
Return on equity (ROE) is 25.28% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.05%
Return on assets (ROA) is 14.36% higher than the industry
Financial Leverage:
1.3x
Current Ratio:
0.96
Current ratio is 2.15% above industry average
Cash Conversion Cycle (days):
54.2
Cash conversion cycle is -31.99% below industry average
The remaining useful life of property plant & equipment is: 5.1 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
810.5K
Each employee generates -51% less revenue than industry average revenue per employee
EBITDA generated per employee:
289.8K
Each employee generates -44% less EBITDA than industry average revenue per employee
Profit generated per employee:
140.0K
Each employee generates -43% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 132.9K
Each employee generates 47% more free cash flow than industry average revenue per employee
Assets/Capital per employee
3.9M
Each employee generates 47% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
ATO
Energy Company of Parana (XNYS:ELP)
CENTERPOINT ENERGY, INC. (XNYS:CNP)
Essential Utilities, Inc. (XNYS:WTRG)
Evergy, Inc. (XNYS:EVRG)
Enel Americas SA (OTCM:ENIAY)
KOREA ELECTRIC POWER CORPORATION (XNYS:KEP)
NISOURCE INC. (XNYS:NI)
VISTRA CORP. (XNYS:VST)
NISOURCE INC. (XNYS:NI)
Current Analyst Ratings
Strong buy�4%
Buy�13%
Hold�21%
Sell�4%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
3.80B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
910.36M
1.91B
-
-
-
-
1.30B
1.30B
-
64.38M
505.29M
1.36B
885.35M
655.70M
723.14M
132.19M
655.70M
Statement of Cash Flow
Date:
Period:
127.86M
Differed Income Tax :
11.81M
Stock Based Compensation :
-
Change in Working Capital :
- 305531.00K
Accounts Receivables:
-
Other Working Capital:
- 305531.00K
Other Non-Cash Items:
48.12M
Net Cash Provided by Operating Activities:
61.82M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
12/31/21
2022
Q1
264.01M
-
264.01M
514.33M
-
2.50B
3.27B
15.73B
731.26M
-
-
1.74B
-
18.20B
-
21.48B
-
2.40B
-
-
1.03B
3.43B
5.56B
-
9.04B
-
-
677.00K
2.97B
23.9M
-
December 31, 2021 at 12:00:00 AM
2.21B
-
21.48B
-
7.96B
7.7B
-
- 679748.00K
- 679748.00K
-
3.92M
-
- 90411.00K
851.70M
765.21M
-
147.28M
264.01M
116.72M
61.82M
- 684180.00K
- 622356.00K
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
ATO
2023
2024
2025
2026
2027
$131.63
$136.17
$140.87
$145.73
$150.76