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Atmos Energy
(NYSE:ATO)
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Rating:70Outperform
Price Target:
$177.00
â–²(5.63% Upside)
Action:Reiterated
Date:10/10/26
ATO’s score is driven primarily by strong profitability and supportive earnings-call fundamentals (reaffirmed guidance, regulatory/rate progress, and good liquidity). These strengths are tempered by structurally negative free cash flow from heavy capex and a weaker technical setup (below key longer-term moving averages), while valuation appears broadly fair with a moderate dividend yield.
Positive Factors
Regulatory rate-base growth
Regulatory rate increases provide a durable mechanism for recovering prudent infrastructure investment and earning an authorized return. The implemented awards and pending filings support continued rate-base expansion, improving revenue visibility and reinforcing the utility’s long-term earnings model.
Negative Factors
Persistent negative free cash flow
Large recurring capital requirements exceed internally generated cash, leaving free cash flow negative across most recent periods. Continued reliance on debt or equity financing can raise funding costs, constrain shareholder returns, and increase sensitivity to capital-market access.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulatory rate-base growth
Regulatory rate increases provide a durable mechanism for recovering prudent infrastructure investment and earning an authorized return. The implemented awards and pending filings support continued rate-base expansion, improving revenue visibility and reinforcing the utility’s long-term earnings model.
Read all positive factors
Atmos Energy Key Performance Indicators (KPIs)
Any
Net Income by Segment
Shows profit contribution from each business area, revealing which segments generate the bulk of earnings, which have higher margins, and where volatility or regulatory pressure could hit the company’s bottom line.
Shows profit contribution from each business area, revealing which segments generate the bulk of earnings, which have higher margins, and where volatility or regulatory pressure could hit the company’s bottom line.
Data provided by:
The Fly
The FlyAtmos Energy (ATO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$27.32B
Dividend Yield2.47%
Average Volume (3M)1.02M
Price to Earnings (P/E)19.0
Beta (1Y)0.08
Revenue Growth6.45%
EPS Growth15.84%
CountryUS
Employees5,487
SectorUtilities
Sector Strength65
IndustryRegulated Gas
Share Statistics
EPS (TTM)8.49
Shares Outstanding168,988,560
10 Day Avg. Volume1,147,092
30 Day Avg. Volume1,016,628
Financial Highlights & Ratios
PEG Ratio2.18
Price to Book (P/B)2.00
Price to Sales (P/S)5.77
P/FCF Ratio-17.95
Enterprise Value/Market Cap1.43
Enterprise Value/Revenue7.92
Enterprise Value/Gross Profit12.97
Enterprise Value/Ebitda14.62
Forecast
1Y Price Target
$181.86Price Target Upside8.53% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)9.03
Revenue Forecast (FY)$5.57B
Atmos Energy Business Overview & Revenue Model
Company Description
Atmos Energy Corporation, alongside its subsidiaries, is a U.S.-based enterprise primarily involved in the regulated distribution of natural gas, as well as operating pipeline and storage facilities. The company functions through two core division...
How the Company Makes Money
Atmos Energy makes money primarily through regulated utility operations, where customer rates are set or approved by state regulatory commissions and are generally designed to allow recovery of prudently incurred costs plus an authorized return on...
Atmos Energy Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call highlighted strong core operating performance: double-digit EPS growth (14.5% YTD), substantial customer additions, large capital investments focused on safety and reliability, meaningful regulatory wins and solid liquidity. These positives outweigh near-term headwinds tied to narrowing APT spreads as additional takeaway capacity came online and modestly higher O&M expectations. Management reaffirmed full-year guidance and outlined project and regulatory drivers that support future growth, although APT earnings are sensitive to market and capacity timing.Positive Updates
Strong Year-to-Date Earnings and EPS Growth
Reported year-to-date net income of $1.2 billion and diluted EPS of $7.33, representing a 14.5% increase in EPS versus the prior year. Company reaffirmed full-year fiscal '26 EPS guidance of $8.40 to $8.50.
Negative Updates
Narrowing APT Spreads and Reduced Near-Term Upside
Beginning in June, spreads narrowed significantly as additional takeaway capacity came online sooner than expected (pipeline capacity additions in late June and July). Management now expects APT incremental contribution toward the prior $0.08–$0.12 EPS range to be toward the lower end of that range, reducing upside from through-system spreads.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Year-to-Date Earnings and EPS Growth
Reported year-to-date net income of $1.2 billion and diluted EPS of $7.33, representing a 14.5% increase in EPS versus the prior year. Company reaffirmed full-year fiscal '26 EPS guidance of $8.40 to $8.50.
Read all positive updates
Company Guidance
Atmos reaffirmed fiscal 2026 EPS guidance of $8.40–$8.50 after reporting year‑to‑date net income of $1.2 billion (or $7.33 per diluted share); management expects full‑year capital expenditures of about $4.2 billion (YTD capex $3.1 billion, with >87% toward safety/reliability) and now projects fiscal‑26 O&M (ex‑net debt expense) of $875–$885 million; the company noted a $132 million ($0.63) benefit from Texas House Bill 4384 (about $71 million in distribution and $61 million at APT), average APT spreads of $4.66 versus $1.77 a year ago, $396 million of annualized operating income implemented year‑to‑date with seven filings seeking ~$334 million more, equity capitalization of 60% with $4.6 billion of available liquidity (including ~$937 million net forward sale proceeds), and reaffirmed plans such as APT Rider REV revenue credits of $160–$165 million for Nov 2026–Oct 2027 and full‑year customer and reliability metrics (nearly 51,000 new customers in the 12 months ending June 30, 2026; ~39,000 in Texas; >97% customer satisfaction for the first 9 months).Atmos Energy Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
78
Positive
Cash Flow
57
Neutral
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.92B | 4.70B | 4.17B | 4.28B | 4.20B | 3.41B |
| Gross Profit | 3.00B | 2.46B | 2.41B | 2.06B | 1.81B | 1.70B |
| EBITDA | 2.67B | 2.38B | 2.10B | 1.74B | 1.49B | 1.38B |
| Net Income | 1.40B | 1.20B | 1.04B | 885.32M | 774.40M | 665.56M |
Balance Sheet | ||||||
| Total Assets | 31.59B | 28.91B | 25.19B | 22.52B | 22.19B | 19.61B |
| Cash, Cash Equivalents and Short-Term Investments | 525.81M | 203.80M | 307.34M | 15.40M | 51.55M | 116.72M |
| Total Debt | 10.26B | 9.30B | 8.13B | 7.12B | 8.37B | 7.56B |
| Total Liabilities | 16.33B | 15.35B | 13.04B | 11.65B | 12.77B | 11.70B |
| Stockholders Equity | 15.26B | 13.56B | 12.16B | 10.87B | 9.42B | 7.91B |
Cash Flow | ||||||
| Free Cash Flow | -2.02B | -1.51B | -1.20B | 653.77M | -1.47B | -3.05B |
| Operating Cash Flow | 2.02B | 2.05B | 1.73B | 3.46B | 977.58M | -1.08B |
| Investing Cash Flow | -4.04B | -3.56B | -2.92B | -2.80B | -2.43B | -1.96B |
| Financing Cash Flow | 1.84B | 1.41B | 1.48B | -696.77M | 1.39B | 3.14B |
Atmos Energy Technical Analysis
Neutral
167.56
Price Trends
164.62
Negative
168.69
Negative
172.69
Negative
Market Momentum
-1.53
Negative
52.66
Neutral
90.89
Negative
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 167.56 is above the 20-day moving average (MA) of 158.98, above the 50-day MA of 164.62, and below the 200-day MA of 172.69, indicating a neutral trend. The MACD of -1.53 indicates Negative momentum. The RSI at 52.66 is Neutral, neither overbought nor oversold. The STOCH value of 90.89 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ATO.
Atmos Energy Risk Analysis
Atmos Energy disclosed 23 risk factors in its most recent earnings report. Atmos Energy reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Atmos Energy Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $27.32B | 19.04 | 9.67% | 2.47% | 6.45% | 15.84% | |
70 Outperform | $5.80B | 19.12 | 7.73% | 3.66% | 2.51% | 0.05% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $6.10B | 11.72 | 12.89% | 3.01% | -63.47% | 166.76% | |
60 Neutral | $4.56B | 15.56 | 8.42% | 3.74% | -0.78% | 10.67% | |
58 Neutral | $4.64B | 8.72 | 15.87% | 4.21% | 4.12% | 93.82% | |
57 Neutral | $19.55B | 21.45 | 9.58% | 2.89% | 12.25% | 0.39% |
* Utilities Sector Average
ATO
Atmos Energy
161.66
-9.90
-5.77%
BKH
Black Hills
76.08
18.29
31.66%
SR
Spire
78.42
-1.20
-1.51%
NI
Nisource
40.76
-0.86
-2.05%
SWX
Southwest Gas
84.14
9.11
12.15%
OGS
ONE Gas
72.50
-4.56
-5.92%
Atmos Energy Corporate Events
Private Placements and Financing
Atmos Energy Completes $700 Million Senior Notes Offering
Positive
Oct 9, 2026
On October 9, 2026, Atmos Energy completed a public offering of $700 million in 6.000% senior unsecured notes due November 15, 2036, receiving approximately $691.4 million in net proceeds after underwriting discounts and expenses. The notes carry ...
Business Operations and StrategyPrivate Placements and Financing
Atmos Energy Prices $700 Million Senior Notes Offering
Positive
Oct 9, 2026
On October 6, 2026 Atmos Energy entered into an underwriting agreement with a syndicate of banks for an underwritten public offering of $700 million of 6.000% Senior Notes due 2036. The notes, issued under an existing indenture and represented by ...
Executive/Board Changes
Atmos Energy Announces Board Addition and Leadership Transition
Positive
Aug 10, 2026
Atmos Energy said on August 10, 2026, that longtime natural gas sector attorney James H. Jeffries IV was elected to its board of directors, effective September 1, 2026, following his retirement from McGuire Woods LLP on August 31, 2026. Jeffries, ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.