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APA Group
(Sydney:APA)
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Rating:60Neutral
Price Target:
AU$11.00
▲(2.14% Upside)
Action:Reiterated
Date:08/22/26
The score is primarily held back by financial structure risk (high leverage) and an uneven income profile (including a sharp 2026 revenue decline), despite strong and stable operating cash generation. Technicals are mildly supportive with the stock trading above major moving averages, but momentum is not strongly positive. Valuation is a meaningful drag due to a very high P/E, partly offset by a strong dividend yield. The latest earnings call was a positive contributor, supported by EBITDA/distribution growth guidance, margin expansion, and a funded growth pipeline, tempered by financing headwinds and project/regulatory risks.
Positive Factors
Margin expansion and cost efficiency
Higher margins and structural cost reductions improve earnings resilience across APA’s infrastructure base. The $80 million delivered savings and targeted ~$100 million annualized run rate can support cash generation beyond a single reporting period.
Negative Factors
Very high financial leverage
The debt-heavy capital structure limits financial flexibility and increases sensitivity to refinancing costs, interest rates and project funding needs. This can constrain distributions or growth investment if cash flows weaken or financing conditions deteriorate.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin expansion and cost efficiency
Higher margins and structural cost reductions improve earnings resilience across APA’s infrastructure base. The $80 million delivered savings and targeted ~$100 million annualized run rate can support cash generation beyond a single reporting period.
Read all positive factors
APA Group (APA) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$14.44B
Dividend Yield5.32%
Average Volume (3M)2.55M
Price to Earnings (P/E)69.4
Beta (1Y)-0.10
Revenue Growth-6.35%
EPS Growth105.89%
CountryAU
Employees2,700
SectorUtilities
Sector Strength65
IndustryRegulated Gas
Share Statistics
EPS (TTM)0.16
Shares Outstanding1,323,751,500
10 Day Avg. Volume3,509,224
30 Day Avg. Volume2,547,843
Financial Highlights & Ratios
PEG Ratio0.58
Price to Book (P/B)4.94
Price to Sales (P/S)4.46
P/FCF Ratio31.18
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$9.97Price Target Upside-7.45% Downside
Rating ConsensusHold
Number of Analyst Covering9
EPS Forecast (FY)0.23
Revenue Forecast (FY)AU$3.09B
APA Group Business Overview & Revenue Model
Company Description
APA Group is an Australian enterprise primarily focused on the energy infrastructure sector. Its business activities are structured across three main segments: Energy Infrastructure, Asset Management, and Energy Investments. The company's diverse ...
How the Company Makes Money
APA Group makes money primarily by providing contracted energy infrastructure services—most notably the transportation and distribution of natural gas—using its networks and related facilities. Revenue is largely generated through long-term arrang...
APA Group Earnings Call Summary
Earnings Call Date:Aug 19, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Feb 25, 2027
Earnings Call Sentiment Positive
The call emphasized strong financial performance (8.3% EBITDA growth), substantial margin expansion (+370 bps), delivered cost savings ($80m in FY '26, ~$100m annualized) and a materially expanded, funded $3.5bn growth pipeline. These positives were balanced against operational softness in select East Coast assets (notably VTS), higher financing and tax cash outflows, earnings reductions from divestments of noncore businesses, project timing/FID risks (e.g., Brigalow) and remaining execution/regulatory uncertainties around large‑scale opportunities such as Beetaloo. On balance the positives (cash flow generation, structural cost savings, margin expansion, funded growth pipeline and ESG/safety outcomes) materially outweigh the noted risks and challenges.Positive Updates
Strong underlying EBITDA growth
Underlying EBITDA increased 8.3% year‑on‑year, driven by inflation‑linked tariff escalation, contributions from new assets and enterprise‑wide cost reductions.
Negative Updates
Flat or weaker performance in some East Coast assets
Certain East Coast assets (e.g., Moomba‑Sydney, Victorian Transmission System (VTS), Roma Brisbane Pipeline, Carpentaria Pipeline) delivered flat or declining EBITDA in real terms year‑on‑year; VTS underperformed due to milder winter conditions and stable electricity markets with high coal availability.
Read all updates
Q4-2026 Updates
Positive
Negative
Strong underlying EBITDA growth
Underlying EBITDA increased 8.3% year‑on‑year, driven by inflation‑linked tariff escalation, contributions from new assets and enterprise‑wide cost reductions.
Read all positive updates
Company Guidance
APA guided FY‑27 underlying EBITDA of $2.26–$2.34 billion (midpoint implying ~5.4% growth on FY‑26), distribution guidance of $0.59 per security (up from $0.58 in FY‑26, the 22nd consecutive year of growth), and said free cash flow should grow broadly in line with inflation. Key financial metrics underpinning the guidance: FY‑26 underlying EBITDA was up 8.3% with EBITDA margin expansion of 370 basis points to 77.9% and free cash flow up 3.2% to just over $1.1 billion; APA delivered $80 million of cost reductions in FY‑26 (exceeding a $50 million target) and expects an incremental $20 million in FY‑27 to reach an annualized run‑rate of ~$100 million. The company also increased its FY‑27–FY‑29 organic growth pipeline from $3.0 billion to $3.5 billion (fully funded), reiterated target project returns of at least 150 basis points above post‑tax WACC, and signalled foundational CapEx of about $100–120 million in FY‑27 (moderating to ~ $80 million in FY‑29), with FY‑27 EBITDA growth driven by inflation‑linked tariff escalations and contributions from new assets (e.g., Sturt Plateau, Basslink conversion and other announced projects).APA Group Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
45
Neutral
Cash Flow
66
Positive
| Breakdown | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.99B | 3.14B | 3.03B | 2.83B | 2.69B |
| Gross Profit | 1.13B | 1.00B | 2.81B | 947.00M | 911.02M |
| EBITDA | 2.18B | 1.94B | 2.62B | 1.70B | 1.66B |
| Net Income | 234.00M | 99.00M | 978.00M | 263.00M | 230.56M |
Balance Sheet | |||||
| Total Assets | 20.22B | 19.94B | 19.56B | 16.52B | 16.20B |
| Cash, Cash Equivalents and Short-Term Investments | 1.64B | 800.00M | 676.00M | 513.00M | 940.28M |
| Total Debt | 14.15B | 14.02B | 12.99B | 11.59B | 10.96B |
| Total Liabilities | 17.52B | 17.27B | 16.32B | 14.61B | 13.57B |
| Stockholders Equity | 2.70B | 1.92B | 3.25B | 1.91B | 2.63B |
Cash Flow | |||||
| Free Cash Flow | 428.00M | 320.00M | 60.00M | 26.00M | 508.22M |
| Operating Cash Flow | 1.25B | 1.28B | 1.16B | 1.21B | 1.20B |
| Investing Cash Flow | -748.00M | -947.00M | -2.66B | -969.00M | -1.27B |
| Financing Cash Flow | 331.00M | -212.00M | 1.66B | -664.00M | 360.66M |
APA Group Technical Analysis
Positive
10.77
Price Trends
10.24
Positive
10.15
Positive
9.51
Positive
Market Momentum
0.22
Negative
69.51
Neutral
93.18
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:APA, the sentiment is Positive. The current price of 10.77 is above the 20-day moving average (MA) of 10.45, above the 50-day MA of 10.24, and above the 200-day MA of 9.51, indicating a bullish trend. The MACD of 0.22 indicates Negative momentum. The RSI at 69.51 is Neutral, neither overbought nor oversold. The STOCH value of 93.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:APA.
APA Group Peers Comparison
UnderperformOutperform
Sector (66)
AU:APA
APA Group
10.91
2.55
30.56%
AU:AGL
AGL Energy
8.72
0.92
11.79%
AU:ORG
Origin Energy Limited
11.35
-0.41
-3.45%
APA Group Corporate Events
APA Group backs Mount Isa with $259m solar and battery project
Aug 19, 2026
APA Group has approved a $259 million investment to construct, own and operate the 72 MW Sybella Creek Solar Farm and a 52 MW, 104 MWh battery energy storage system in Mount Isa, Queensland, backed by a long-term energy supply agreement with Evolu...
APA Group Releases Updated Corporate Governance Statement
Aug 19, 2026
APA Group, a major ASX-listed energy infrastructure operator, controls more than $20 billion in assets spanning gas transmission, processing, compression, storage, power generation, battery storage and electricity transmission. Its extensive pipel...
APA Group Sets Final 30.5c Distribution for June 2026 Half-Year
Aug 19, 2026
APA Group has announced final distribution details for the six months ended 30 June 2026, setting a total distribution of 30.50 cents per security, with key tax components split between APA Infrastructure Trust and APA Investment Trust. The paymen...
APA Group lodges FY26 full-year results presentation with ASX
Aug 19, 2026
APA Group has released its financial results presentation for the full year ended 30 June 2026, providing investors with detailed information on the company’s FY26 performance. The presentation, lodged with the ASX for APA Group and APA Infr...
APA Group lifts FY26 earnings, expands $3.5bn growth pipeline
Aug 19, 2026
APA Group reported a robust FY26 performance, with underlying EBITDA up 8.3% to $2,183 million and margins rising to 77.9%, supported by inflation-linked tariffs, newly commissioned assets and $80 million of cost-out initiatives that beat its targ...
APA Group Updates June 2026 Distribution Details for Stapled Securities
Aug 19, 2026
APA Group has updated its notification to investors regarding a scheduled distribution on its fully paid stapled securities for the six-month period ended 30 June 2026. The adjustment revises the total distribution payment amount per security and ...
APA Group lifts earnings and cash flow despite revenue decline in 2026 results
Aug 19, 2026
APA Group has reported its annual financial results for the year ended 30 June 2026, highlighting solid operational performance in its energy infrastructure portfolio despite a dip in headline revenue. Total revenue, including equity-accounted inv...
APA faces investor-led governance and capital discipline resolutions at 2026 AGM
Aug 17, 2026
APA Group has received a set of securityholder-requisitioned resolutions for consideration at its 22 October 2026 annual meeting, lodged under section 252L of the Corporations Act, from investors holding about 0.01482% of its stapled securities. T...
APA Group Adjusts FX Rate and DRP Price for Half-Year Distribution
Jul 23, 2026
APA Group has updated its notification regarding a distribution on its fully paid stapled securities for the six-month period ending 30 June 2026, listed under ASX code APA. The change revises the New Zealand dollar exchange rate applied to the pa...
APA Group lifts estimated final FY26 distribution and activates discounted DRP
Jun 19, 2026
APA Group has estimated a final distribution of 30.5 cents per security for the six months to 30 June 2026, a 1.7% increase on the prior year’s final payout, taking forecast total FY26 distributions to 58.0 cents per security in line with ea...
APA Group sets September payment for AUD 0.305 half-year distribution
Jun 18, 2026
APA Group has declared a distribution of AUD 0.305 per fully paid stapled security for the six-month period ending 30 June 2026, with an ex-date of 29 June, a record date of 30 June and payment scheduled for 16 September 2026. The announcement und...
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.