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1. Company Snapshot

1.a. Company Description

Chesapeake Utilities Corporation operates as an energy delivery company.The company operates through two segments, Regulated Energy and Unregulated Energy.The Regulated Energy segment engages in the natural gas distribution operations in central and southern Delaware, Maryland's eastern shore, and Florida; regulated natural gas transmission in the Delmarva Peninsula and Florida; and regulated electric distribution in northeast and northwest Florida.


The Unregulated Energy segment engages in the propane operations in the Mid-Atlantic region, North Carolina, South Carolina, and Florida; unregulated natural gas transmission/supply operation in central and eastern Ohio; generation of electricity and steam; and provision of compressed natural gas, liquefied natural gas, and renewable natural gas transportation and pipeline solutions primarily to utilities and pipelines in the eastern United States.This segment also provides other unregulated energy services, such as energy-related merchandise sales; heating, ventilation, and air conditioning services; and plumbing and electrical services.The company was founded in 1859 and is headquartered in Dover, Delaware.

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1.b. Last Insights on CPK

Chesapeake Utilities Corporation's recent performance was driven by strong Q2 2025 earnings and revenue beat, surpassing Zacks Consensus Estimate. The company's adjusted net income and adjusted EPS, excluding transaction and transition-related expenses, were $24.3 million and $1.04, respectively, for the second quarter of 2025. Adjusted gross margin growth of $16.2 million and $34.1 million, respectively, for the three- and six-month periods ended June 30, 2025, was driven by natural gas organic growth, transmission expansion projects, regulatory initiatives, and infrastructure programs. The company also continued to execute its 2025 financing plan by issuing equity and increasing debt capacity, including a $200 million long-term debt agreement in August 2025.

1.c. Company Highlights

2. Chesapeake Utilities' Q3 2025 Earnings: Steady Growth and Increased Guidance

Chesapeake Utilities Corporation reported adjusted earnings per share of $0.82 for the third quarter of 2025, a 3% increase year-over-year, slightly below analyst estimates of $0.9. Adjusted gross margin grew 12% to $137 million, and adjusted net income rose 8% to $20 million. The company's financial performance was driven by continued demand for natural gas, margin from infrastructure program investments, and permanent rates from rate cases. As Beth Cooper, Executive Vice President, Chief Financial Officer, noted, the unregulated businesses generated net incremental earnings of $0.09 per share, largely driven by growth in the Marlin Virtual Pipeline transportation business.

Publication Date: Nov -14

📋 Highlights
  • Adjusted Earnings Growth:: Adjusted EPS increased 8% to $4.06, driven by 12% growth in adjusted gross margin to $137 million and 8% rise in adjusted net income to $20 million.
  • Capital Expenditure Expansion:: Full-year 2025 capex guidance raised to $425–450 million, up $25 million from prior, generating $50 million in projected gross margin for 2025.
  • Regulatory Rate Case Impact:: Permanent rates in Delaware, Maryland, and Florida contributed $13.1 million in 2025 margin and $18.2 million expected in 2026.
  • Unregulated Energy Segment Growth:: Adjusted gross margin rose 13% to $22.5 million, with Marlin Virtual Pipeline driving $0.09/share incremental earnings.
  • Dividend Policy Strengthening:: 7% annualized dividend increase to $2.74/share, maintaining 45–50% payout ratio to support 9% long-term EPS CAGR through 2028.

Segment Performance

The company's Regulated segment demonstrated strength in core business operations, organic natural gas transmission expansions, and increased rates following the conclusion of rate cases. The unregulated Energy segment also showed strong growth, with adjusted gross margin up 13% to approximately $22.5 million. Aspire Energy's performance in the third quarter was impacted by changes in margins and service fees within the propane operations.

Capital Expenditure and Guidance

The company increased its full-year 2025 capital expenditure guidance to $425 million to $450 million, a $25 million increase over the top end of its prior range. Chesapeake Utilities reaffirmed its full-year 2025 EPS guidance of $6.15 to $6.35 per share. The company's expectation is to continue to hold to its long-term capital expenditure guidance of $1.5 billion to $1.8 billion through 2028.

Valuation and Growth Prospects

With a P/E Ratio of 24.07 and an ROE of 8.94%, the company's valuation appears reasonable. Analysts estimate next year's revenue growth at 6.1%. The company's dividend yield stands at 1.98%, with a long-term dividend CAGR of 9%. The company's growth prospects are promising, driven by increasing demand for natural gas and infrastructure reliability improvements.

Outlook

Chesapeake Utilities remains committed to delivering on its promises, driving significant shareholder value in 2025 and beyond. The company's growth trajectory is expected to continue, with multiple projects already in service and producing significant margin. The outcome of the Florida City Gas depreciation study will be crucial in determining the timing and amount of the depreciation reserve.

3. NewsRoom

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Analyzing Hong Kong & China Gas (OTCMKTS:HOKCY) & Chesapeake Utilities (NYSE:CPK)

Nov -26

Source: defenseworld.net

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Chesapeake Utilities Corporation Honored as Employer Champion of the Year by Delaware Department of Labor

Nov -12

Source: prnewswire.com

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Chesapeake Utilities Corporation (CPK) Q3 2025 Earnings Call Transcript

Nov -07

Source: seekingalpha.com

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Chesapeake Utilities (CPK) Q3 Earnings Miss Estimates

Nov -07

Source: zacks.com

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CHESAPEAKE UTILITIES CORPORATION REPORTS THIRD QUARTER 2025 RESULTS

Nov -06

Source: prnewswire.com

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Chesapeake Utilities Corporation Announces Quarterly Dividend

Nov -06

Source: prnewswire.com

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Chesapeake Utilities to Host its Third Quarter 2025 Earnings Conference Call and Webcast on November 7, 2025

Oct -21

Source: prnewswire.com

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Chesapeake Utilities Corporation Businesses Honored Among Delaware's Best

Sep -19

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.19%)

6. Segments

Regulated Energy

Expected Growth: 9%

Chesapeake Utilities Corporation's Regulated Energy segment growth is driven by increasing demand for natural gas, strategic infrastructure investments, and favorable regulatory environments. Additionally, the company's focus on safety, reliability, and customer satisfaction contributes to its growth. Furthermore, the segment benefits from a strong balance sheet, enabling investments in growth initiatives and opportunistic acquisitions.

Unregulated Energy

Expected Growth: 13%

Chesapeake Utilities Corporation's 13% growth in Unregulated Energy is driven by increasing demand for natural gas, expansion into new markets, and strategic acquisitions. Additionally, investments in infrastructure and technology have improved operational efficiency, allowing the company to capitalize on rising energy prices and growing customer base.

7. Detailed Products

Natural Gas Distribution

Chesapeake Utilities Corporation provides natural gas distribution services to residential, commercial, and industrial customers in Delaware and Maryland.

Propane Distribution

The company distributes propane to customers in Delaware, Maryland, Virginia, and Florida for various applications such as heating, cooking, and powering appliances.

Electricity Distribution

Chesapeake Utilities Corporation provides electricity distribution services to customers in Delaware and Maryland.

Pipeline Transmission

The company owns and operates pipeline transmission systems that transport natural gas to customers in the Mid-Atlantic region.

Gas Gathering and Processing

Chesapeake Utilities Corporation gathers and processes natural gas from wells in Ohio, Pennsylvania, and West Virginia.

Energy Services

The company offers energy services such as energy efficiency solutions, renewable energy solutions, and energy management services.

8. Chesapeake Utilities Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Chesapeake Utilities Corporation is moderate due to the availability of alternative energy sources such as solar and wind power.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of alternative energy providers in the region, giving Chesapeake Utilities Corporation a significant market share.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate due to the presence of multiple suppliers of natural gas and other energy sources, but Chesapeake Utilities Corporation's large scale of operations gives it some negotiating power.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the energy industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the energy industry, leading to intense competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 52.84%
Debt Cost 3.95%
Equity Weight 47.16%
Equity Cost 6.97%
WACC 5.37%
Leverage 112.03%

11. Quality Control: Chesapeake Utilities Corporation passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Brookfield Infrastructure

A-Score: 6.7/10

Value: 8.9

Growth: 4.3

Quality: 5.8

Yield: 8.0

Momentum: 5.0

Volatility: 8.3

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ONE Gas

A-Score: 6.3/10

Value: 5.9

Growth: 4.4

Quality: 4.7

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

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UGI

A-Score: 6.2/10

Value: 5.6

Growth: 2.3

Quality: 4.1

Yield: 8.0

Momentum: 8.0

Volatility: 9.0

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Southwest Gas Holdings

A-Score: 5.9/10

Value: 4.2

Growth: 5.2

Quality: 3.5

Yield: 7.0

Momentum: 6.0

Volatility: 9.7

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Chesapeake Utilities

A-Score: 5.7/10

Value: 3.6

Growth: 4.7

Quality: 5.2

Yield: 4.0

Momentum: 7.0

Volatility: 10.0

1-Year Total Return ->

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New Fortress Energy

A-Score: 3.7/10

Value: 9.8

Growth: 6.4

Quality: 2.5

Yield: 3.0

Momentum: 0.0

Volatility: 0.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

129.14$

Current Price

129.14$

Potential

-0.00%

Expected Cash-Flows