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1. Company Snapshot

1.a. Company Description

UGI Corporation distributes, stores, transports, and markets energy products and related services in the United States and internationally.The company operates through four segments: AmeriGas Propane, UGI International, Midstream & Marketing, and UGI Utilities.It distributes propane to approximately 1.4 million residential, commercial/industrial, motor fuel, agricultural, and wholesale customers through 1,600 propane distribution location.


The company also distributes liquefied petroleum gases (LPG) to residential, commercial, industrial, agricultural, wholesale and automobile fuel customers; and provides logistics, storage, and other services to third-party LPG distributors.In addition, it engages in the retail sale of natural gas, liquid fuels, and electricity to approximately 12,600 residential, commercial, and industrial customers at 42,400 locations.Further, the company distributes natural gas to approximately 672,000 customers in eastern and central Pennsylvania counties through its distribution system of approximately 12,400 miles of gas mains; and supplies electricity to approximately 62,500 customers in northeastern Pennsylvania through 2,600 miles of lines and 14 substations.


Additionally, it operates electric generation facilities, which include coal-fired, landfill gas-fueled, solar-powered, and natural gas-fueled facilities; a natural gas liquefaction, storage, and vaporization facility; propane storage and propane-air mixing stations; and rail transshipment terminals.It also manages natural gas pipeline and storage contracts; develops, owns, and operates pipelines, gathering infrastructure, and gas storage facilities.UGI Corporation was incorporated in 1991 and is based in King of Prussia, Pennsylvania.

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1.b. Last Insights on UGI

UGI Corporation's recent performance was driven by improving fundamentals, with AmeriGas turnaround and regulated utility investments driving EBIT growth. The company reported strong fiscal 2025 results, with GAAP net income of $678 million and adjusted net income of $728 million. A quarterly dividend of $0.375 per share was declared, offering a 3.9% dividend yield. Despite a Q1 earnings miss, with EPS of $1.26, the company sees 5-7% EBIT growth in FY 2026. Investments in RNG and data centers provide long-term growth catalysts. (Source: "UGI: Buy This Undervalued Utility With Data Center Catalysts")

1.c. Company Highlights

2. UGI Corporation's Q1 2026 Earnings: A Solid Performance

UGI Corporation reported a total reportable segment EBIT of $441 million for Q1 2026, representing a 5% year-over-year increase. The company's adjusted diluted EPS was $1.26, down from $1.37 in the prior year, primarily due to the absence of investment tax credits and higher interest expense. The actual EPS came in below estimates of $1.5. Revenue growth is expected to be around 2.3% next year according to analysts' estimates. The utilities segment delivered EBIT of $157 million, up $16 million, driven by higher gas base rates in Pennsylvania and colder weather. The global LPG businesses also performed well, with UGI International reporting EBIT of $124 million, up $14 million.

Publication Date: Feb -08

📋 Highlights
  • Total Segment EBIT Growth:: Q1 2026 reportable segment EBIT rose to $441 million, a 5% increase YoY driven by natural gas and LPG operations.
  • Utilities Segment Performance:: EBIT reached $157 million, up $16 million YoY, fueled by Pennsylvania gas rate hikes and colder weather.
  • Global LPG EBIT Strength:: UGI International posted $124 million EBIT (+$14M YoY) due to margin management, while AmeriGas dropped to $72 million (−$2M YoY).
  • Capital Allocation Focus:: $225 million deployed, with 73% ($165.8M) directed to regulated utilities for infrastructure upgrades, including a new LNG facility.
  • Rate Increase Filings:: $99 million and $27 million requested for UGI Utilities and Mountaineer Gas to fund $500 million+ in system upgrades.

Segment Performance

The company's utilities segment was a key contributor to the overall growth, with AmeriGas reporting EBIT of $72 million, down $2 million due to higher operating and administrative expenses. The global LPG businesses demonstrated disciplined margin management, with UGI International's operating efficiencies driving the increase in EBIT. As Robert Flexon, CEO, emphasized, the company's focus on operational excellence, safety, and capital discipline is yielding positive results.

Capital Deployment and Growth Prospects

UGI deployed $225 million of capital during the quarter, with 73% going to regulated utilities businesses for infrastructure replacement and system betterment. The new Carlisle LNG storage and vaporization facility is now operational, backing a long-term contract with the utility segment. The company is engaged in significant discussions and hopes to announce new developments during the current fiscal year, driven by increasing natural gas demand in Pennsylvania and potential for new data center and power generation projects.

Valuation and Outlook

With a P/E Ratio of 13.28 and an EV/EBITDA of 9.92, the market appears to have priced in a moderate growth outlook for UGI Corporation. The company's ROE of 12.21% and ROIC of 7.63% indicate a decent return on equity and invested capital, respectively. The Dividend Yield stands at 4.04%, providing a relatively stable source of return for investors. As the company continues to focus on operational excellence and capital discipline, it is well-positioned to navigate the evolving energy landscape and capitalize on emerging opportunities.

3. NewsRoom

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UGI VP Sells 12840 Shares After Net Income Falls in Q1 Earnings

Feb -22

Source: fool.com

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UGI (NYSE:UGI) Stock Price Crosses Above Two Hundred Day Moving Average – Time to Sell?

Feb -21

Source: defenseworld.net

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FPA Queens Road Small Cap Value Fund Q4 2025 Performance Review

Feb -20

Source: seekingalpha.com

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This Utilities Stock Is Up 23% Over the Past Year and One Fund Is Betting $49 Million on Sustained Growth

Feb -14

Source: fool.com

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UGI's Q1 Earnings and Sales Lower Than Estimates, New Storage Online

Feb -05

Source: zacks.com

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UGI Corporation (UGI) Q1 2026 Earnings Call Transcript

Feb -05

Source: seekingalpha.com

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UGI (UGI) Misses Q1 Earnings and Revenue Estimates

Feb -04

Source: zacks.com

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UGI Corporation Appoints Sidd Manjeshwar as Chief Strategy Officer

Feb -04

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.67%)

6. Segments

UGI International

Expected Growth: 3.5%

UGI International's 3.5% growth is driven by increasing demand for liquefied petroleum gas (LPG) in Europe, expansion into new markets, and strategic acquisitions. Additionally, the segment benefits from a strong cost management and operational efficiency, which enables it to maintain a competitive edge in the market.

AmeriGas Propane

Expected Growth: 3.2%

AmeriGas Propane's 3.2% growth is driven by increasing demand for propane as a clean energy source, strategic acquisitions, and cost savings initiatives. Additionally, UGI Corporation's diversified energy portfolio and strong distribution network contribute to the segment's growth. Furthermore, investments in technology and operational efficiencies also support the growth momentum.

Utilities

Expected Growth: 4.5%

UGI Corporation's 4.5% growth in Utilities segment is driven by increasing demand for natural gas, strategic acquisitions, and infrastructure investments. Additionally, favorable weather patterns, rate base growth, and cost savings initiatives contribute to the segment's growth.

Midstream and Marketing

Expected Growth: 3.8%

UGI Corporation's Midstream and Marketing segment growth of 3.8% is driven by increased natural gas demand, expansion of pipeline infrastructure, and strategic acquisitions. Additionally, growth in liquefied petroleum gas (LPG) exports and optimization of logistics and transportation operations contribute to the segment's growth.

Corporate and Other

Expected Growth: 2.8%

UGI Corporation's Corporate and Other segment growth of 2.8% is driven by increased cost savings initiatives, effective expense management, and strategic investments in growth projects. Additionally, the segment benefits from a strong balance sheet, enabling investments in high-return projects and opportunistic acquisitions, further enhancing growth prospects.

7. Detailed Products

LPG

Liquefied Petroleum Gas, a clean-burning fuel used for heating, cooking, and powering vehicles

Natural Gas

A fossil fuel used for heating, cooking, and generating electricity

Renewable Natural Gas (RNG)

A sustainable alternative to traditional fossil fuels, produced from organic waste

Electricity

A form of energy used for powering homes, businesses, and industries

Energy Services

A range of services including energy efficiency solutions, energy management, and energy procurement

Midstream Services

A range of services including natural gas gathering, processing, and transportation

8. UGI Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for UGI Corporation is moderate due to the availability of alternative energy sources such as renewable energy and energy-efficient solutions.

Bargaining Power Of Customers

The bargaining power of customers is low for UGI Corporation as the company operates in a regulated industry, and customers have limited alternatives.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for UGI Corporation as the company relies on a few large suppliers for its energy needs, but has some flexibility to negotiate prices.

Threat Of New Entrants

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

Intensity Of Rivalry

The intensity of rivalry is high for UGI Corporation as the company operates in a competitive energy market with several established players, 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 62.30%
Debt Cost 6.39%
Equity Weight 37.70%
Equity Cost 9.62%
WACC 7.61%
Leverage 165.28%

11. Quality Control: UGI Corporation passed 0 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: 6.8/10

Value: 8.7

Growth: 4.2

Quality: 5.7

Yield: 8.0

Momentum: 6.0

Volatility: 8.0

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ONE Gas

A-Score: 6.4/10

Value: 6.4

Growth: 4.4

Quality: 4.8

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

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UGI

A-Score: 6.4/10

Value: 6.0

Growth: 2.4

Quality: 4.8

Yield: 8.0

Momentum: 8.0

Volatility: 9.0

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Southwest Gas Holdings

A-Score: 6.1/10

Value: 4.3

Growth: 5.2

Quality: 3.6

Yield: 7.0

Momentum: 7.0

Volatility: 9.7

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Chesapeake Utilities

A-Score: 6.0/10

Value: 5.3

Growth: 4.8

Quality: 5.1

Yield: 4.0

Momentum: 7.0

Volatility: 10.0

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New Fortress Energy

A-Score: 3.9/10

Value: 10.0

Growth: 6.4

Quality: 3.4

Yield: 3.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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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

38.29$

Current Price

38.29$

Potential

-0.00%

Expected Cash-Flows