Wells upgrades One Gas to Overweight on regulatory, cost trends

Wells Fargo analyst Sarah Akers upgraded One Gas to Overweight from Equal Weight with a price target of $80, up from $71. The firm is “encouraged” by the company’s recent regulatory and cost trends and likes its “strong credit metrics, pure play strategy and gas-friendly landscape.” One Gas deserves a premium valuation multiple given its pure play local distribution company, strategy, strong credit metrics, generally supportive regulation and long runway of investment opportunities, the analyst tells investors in a research note. “While recent headwinds tied to interest rates and inflation have held us back, we believe OGS has turned the page,” contends Wells.