Here's Why You Should Add UGI Stock to Your Portfolio Right Now

UGI Corporation’s UGI strategic investment plans, which help upgrade and replace its aging infrastructure, boost its overall performance. Given its growth opportunities and strong return on equity (ROE), UGI makes for a solid investment option in the utility sector.Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.UGI’s Growth Projections & Surprise HistoryThe Zacks Consensus Estimate for fiscal 2025 earnings per share (EPS) has moved up 1.3% in the past 90 days to $3.06.The Zacks Consensus Estimate for sales is pinned at $7.79 billion, indicating a year-over-year increase of 8%.  UGI’s long-term (three to five years) earnings growth rate is 5.2%. The company delivered a trailing four-quarter average earnings surprise of 75.7%.UGI’s Debt PositionCurrently, UGI’s total debt to capital is 58.34%, better than the sector’s average of 59.9%.The time-to-interest earned ratio at the end of the fiscal second quarter of 2025 was 2.5. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.Return on Equity of UGIROE indicates how efficiently a company has been utilizing the funds to generate higher returns. Currently, UGI’s ROE is 16.21%, higher than the industry’s average of 9.27%. This indicates that the company has been utilizing the funds more constructively than its peers in the utility gas distribution industry.UGI’s Focus on Strategic InvestmentsUGI continues to make systematic capital investments to address various capital projects, increase the safety and reliability of natural gas production and storage facilities, and replace aging infrastructure to modernize the system. These additions and upgrades allow it to serve the expanding customer base efficiently. The company has added more than 6,600 residential heating and commercial customers to the Utilities year to date.UGI invested $160 million in the fiscal second quarter to further strengthen its operations, with 79% invested in the natural gas businesses. It plans to invest $800-$900 million in fiscal 2025 to strengthen its operations, and $3.7-$4.1 billion through fiscal 2027.UGI’s Dividend HistoryThe consistently strong performance of the company has enabled it to reward its shareholders through annual dividend rate hikes. UGI has been paying dividends for the last 141 years. Currently, its quarterly dividend is 37.5 cents per share, resulting in an annualized dividend of $1.50. The company’s current dividend yield of 4.29% is better than the industry’s average of 3.43%.UGI’s Share Price PerformanceIn the past six months, shares of the company have risen 45.4% against the industry’s 3.8% decline. Image Source: Zacks Investment ResearchOther Stocks to ConsiderA few other top-ranked stocks from the same industry are Southwest Gas SWX, sporting a Zacks Rank #1 (Strong Buy), and New Jersey Resources NJR and Spire SR, both holding a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.SWX’s long-term earnings growth rate is 9.5%. The Zacks Consensus Estimate for 2025 EPS indicates a year-over-year increase of 18%.The Zacks Consensus Estimate for NJR’s fiscal 2025 EPS implies year-over-year growth of 8.9%. The Zacks Consensus Estimate for fiscal 2025 sales indicates an increase of 4.1% from the top line reported in fiscal 2024.SR’s long-term earnings growth rate is 6.54%. The Zacks Consensus Estimate for fiscal 2025 EPS indicates year-over-year growth of 8.7%. Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 256 positions with double- and triple-digit gains in 2024 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Southwest Gas Corporation (SWX): Free Stock Analysis Report UGI Corporation (UGI): Free Stock Analysis Report Spire Inc. (SR): Free Stock Analysis Report NewJersey Resources Corporation (NJR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks