Atmos Energy (ATO) AI Stock Analysis

• Market Cap: $27.56B
• Dividend Yield: 2.03%
• Average Volume (3M): 765.89K
• Price to Earnings (P/E): 24.1
• Beta (1Y): 0.20
• Revenue Growth: 12.90%
• EPS Growth: 7.70%
• Country: US
• Employees: 5,260
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Gas
• EPS (TTM): 1.16
• Shares Outstanding: 160,523,570
• 10 Day Avg. Volume: 753,434
• 30 Day Avg. Volume: 765,889
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 7.16
• Enterprise Value/Gross Profit: 13.29
• Enterprise Value/Ebitda: 14.23
• 1Y Price Target: $175.43
• Price Target Upside: 2.20% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 79 Outperform
• Price Target: $188.00 ▲(9.52% Upside)

Atmos Energy's overall stock score is driven by strong financial performance and positive earnings call sentiment. The company's robust technical indicators and strategic financial moves further support its position. However, concerns about cash flow management and moderate valuation temper the score.

Positive Factors

Strong Customer Growth

The addition of new residential and industrial customers indicates expanding market reach and potential for sustained revenue growth, enhancing long-term business stability.

Favorable Legislative Impact

The legislative change in Texas supports increased capital spending, which can improve infrastructure and operational efficiency, positively impacting long-term earnings potential.

Robust Financial Position

A strong equity base and substantial liquidity provide financial flexibility, enabling strategic investments and resilience against economic fluctuations.

Negative Factors

Negative Free Cash Flow

Negative free cash flow indicates challenges in converting income into cash, potentially limiting the company's ability to fund operations and growth initiatives without external financing.

Increased Operational Expenses

Rising operational expenses can pressure profit margins and reduce financial flexibility, potentially impacting long-term profitability if not managed effectively.

Impact of Bad Debt Expense

The impact of nonrecurring bad debt adjustments can distort financial performance metrics, complicating accurate assessment of operational efficiency and financial health.

Atmos Energy Business Overview & Revenue Model

Company Description

Atmos Energy Corporation, together with its subsidiaries, engages in the regulated natural gas distribution, and pipeline and storage businesses in the United States. It operates through two segments, Distribution, and Pipeline and Storage. The Distribution segment is involved in the regulated natural gas distribution and related sales operations in eight states. This segment distributes natural gas to approximately three million residential, commercial, public authority, and industrial customers. As of September 30, 2021, it owned 71,921 miles of underground distribution and transmission mains. The Pipeline and Storage segment engages in the pipeline and storage operations. This segment transports natural gas for third parties and manages five underground storage reservoirs in Texas; and provides ancillary services to the pipeline industry, including parking arrangements, lending, and inventory sales. As of September 30, 2021, it owned 5,699 miles of gas transmission lines. Atmos Energy Corporation was founded in 1906 and is headquartered in Dallas, Texas.

How the Company Makes Money

Atmos Energy generates revenue primarily through the distribution of natural gas to residential, commercial, and industrial customers. The company earns money by charging customers for the natural gas they consume, as well as for the delivery of that gas. Revenue is derived from regulated rates set by state utility commissions, which allows Atmos Energy to recover its costs and earn a return on its investments in infrastructure. Key revenue streams include base rates, which cover the cost of gas delivery, and additional charges for services such as storage and transportation. Atmos Energy also benefits from partnerships with suppliers and other stakeholders in the energy sector, which can enhance its operational efficiency and expand its service offerings. Additionally, the company may experience revenue growth through infrastructure investments and expansion into new markets.

Atmos Energy Financial Statement Overview

Summary

Atmos Energy demonstrates strong revenue and profit growth with robust operational efficiency. The income statement and balance sheet are solid, though cash flow management needs improvement due to high capital expenditures.

Income Statement

Atmos Energy has shown robust revenue growth, with the most recent TTM (Trailing-Twelve-Months) revenue up 7.7% from the previous year. The company maintains a strong Gross Profit Margin of 54.4% and a healthy Net Profit Margin of 25.3%. The EBIT and EBITDA margins are also solid at 33.3% and 50.9%, respectively, indicating strong operational efficiency. Overall, the income statement reflects both growth and profitability.

Balance Sheet

The balance sheet shows a moderate Debt-to-Equity Ratio of 0.65, indicating a balanced approach to leveraging. The Return on Equity (ROE) is strong at 8.7%, reflecting efficient use of shareholder funds. The Equity Ratio of 48.7% demonstrates a healthy proportion of equity financing relative to total assets. The company's financial position appears stable with manageable leverage.

Cash Flow

Operating cash flow has grown to $1.95 billion, although free cash flow remains negative at -$1.31 billion due to significant capital expenditures. The Free Cash Flow to Net Income Ratio is not favorable, suggesting a need for improved cash generation relative to earnings. The Operating Cash Flow to Net Income Ratio is 1.71, indicating good cash generation capabilities despite the high capital expenditure outlays.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.62B	4.17B	4.28B	4.20B	3.41B	2.82B
Gross Profit	2.49B	2.41B	2.06B	1.81B	1.70B	1.53B
EBITDA	2.33B	2.10B	1.74B	1.49B	1.38B	1.26B
Net Income	1.16B	1.04B	885.32M	774.40M	665.56M	601.44M
Balance Sheet
Total Assets	27.71B	25.19B	22.52B	22.19B	19.61B	15.36B
Cash, Cash Equivalents and Short-Term Investments	713.60M	307.34M	15.40M	51.55M	116.72M	20.81M
Total Debt	9.00B	8.13B	7.12B	8.37B	7.56B	4.77B
Total Liabilities	14.33B	13.04B	11.65B	12.77B	11.70B	8.57B
Stockholders Equity	13.39B	12.16B	10.87B	9.42B	7.91B	6.79B
Cash Flow
Free Cash Flow	-1.37B	-1.20B	653.77M	-1.47B	-3.05B	-897.68M
Operating Cash Flow	2.03B	1.73B	3.46B	977.58M	-1.08B	1.04B
Investing Cash Flow	-3.40B	-2.92B	-2.80B	-2.43B	-1.96B	-1.93B
Financing Cash Flow	1.40B	1.48B	-696.77M	1.39B	3.14B	883.78M

Atmos Energy Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 171.66
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ATO, the sentiment is Neutral. The current price of 171.66 is below the 20-day moving average (MA) of 175.28, above the 50-day MA of 169.57, and above the 200-day MA of 156.03, indicating a neutral trend. The MACD of 1.67 indicates Positive momentum. The RSI at 45.09 is Neutral, neither overbought nor oversold. The STOCH value of 14.51 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ATO.

Atmos Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATO	―	$27.56B	24.10	9.05%	2.03%	12.90%	7.70%
NJR	―	$4.45B	11.10	18.03%	4.12%	21.88%	71.35%
OGS	―	$4.83B	19.73	8.24%	3.31%	13.43%	6.49%
SWX	―	$5.80B	30.00	5.41%	3.08%	-10.07%	5.98%
Sector *	―	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
NI	―	$20.43B	23.05	10.56%	2.60%	16.98%	12.45%
UGI	―	$7.14B	17.71	8.75%	4.52%	-0.52%	-39.42%

Atmos Energy Corporate Events

Atmos Energy Completes $600M Senior Notes Offering

On October 1, 2025, Atmos Energy Corporation completed a public offering of $600 million in senior notes due in 2056, with a 5.450% interest rate. This move is expected to strengthen the company’s financial position by securing substantial funding, which could impact its operational capabilities and market standing.

The most recent analyst rating on (ATO) stock is a Hold with a $170.00 price target. To see the full list of analyst forecasts on Atmos Energy stock, see the ATO Stock Forecast page.

Atmos Energy Announces $600M Senior Notes Offering

On September 18, 2025, Atmos Energy Corporation announced an underwriting agreement for a public offering of $600 million in 5.450% Senior Notes due 2056. The offering is expected to close on or about October 1, 2025, with anticipated net proceeds of approximately $589.8 million, which will impact the company’s financial operations and market positioning.

The most recent analyst rating on (ATO) stock is a Hold with a $170.00 price target. To see the full list of analyst forecasts on Atmos Energy stock, see the ATO Stock Forecast page.

Atmos Energy Reports Strong Q3 Earnings and Raises Guidance

Atmos Energy Corporation, a natural gas-only distributor and S&P 500 company, is headquartered in Dallas and serves over 3.3 million customers across eight states, primarily in the South. The company focuses on delivering reliable and efficient natural gas while investing in safety, innovation, and environmental sustainability.

Atmos Energy’s Earnings Call Highlights Strong Growth

Atmos Energy’s recent earnings call painted a largely positive picture, underscoring robust financial performance, significant customer growth, and favorable impacts from new legislative measures. Despite facing some challenges with increased operating expenses and bad debt expense, the overall sentiment was optimistic, with the positives outweighing the negatives.