Spire Benefits From Infrastructure Upgrades & Expanding Customer Base

Spire Inc. SR continues to benefit from its systematic capital investments to strengthen infrastructure and improve service reliability. The company also benefits from the expanding natural gas customer base. However, this Zacks Rank #3 (Hold) company faces risks related to its dependence on its units to meet all financial needs.Factors Acting in Favor of SRSpire makes consistent investments to upgrade and maintain its existing infrastructure as well as expand operations. Capital expenditures for fiscal 2025 are expected to be $840 million, up from the previous guidance of $790 million. The higher capital expenditures include a $15 million increase at Spire Missouri and a $35 million increase at Midstream primarily for the storage expansion project.The company also invested nearly $103 million in installing advanced meters so far in the fiscal year. Spire continues to install ultrasonic meters across utilities to improve customer experience. SR installed more than 350,000 advanced meters in fiscal 2024, bringing the total number of customers benefiting from this technology to 850,000.Spire is actively expanding its customer base through acquisitions. This strategy enables the company to expand its geographic reach and customer base, while enhancing its existing infrastructure. Spire’s acquisition of MoGas and Omega pipeline systems, which added nearly 263 miles of interstate natural gas pipelines to its network, helps serve its growing customer base in St. Louis, MO.Challenges Faced by SRSpire is a holding company with no significant assets, which makes it dependent on its operating units to meet its financial obligations. Also, its ability to pay out dividends depends on its subsidiaries’ capacity to generate sufficient net income and cash flows to disburse dividends and repay loans.SR’s financial performance may suffer if there is a significant disruption in the transmission and storage capacity of interstate natural gas pipelines during times of high demand.SR Stock’s Price PerformanceIn the past six months, shares of the company have risen 12.7% compared with the industry’s 3.1% growth. Image Source: Zacks Investment ResearchStocks to ConsiderSome better-ranked stocks from the same industry are UGI Corporation UGI, sporting a Zacks Rank #1 (Strong Buy), and Atmos Energy ATO and ONE Gas OGS, both holding a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.UGI’s long-term (three to five year) earnings growth rate is 5.2%. The Zacks Consensus Estimate for fiscal 2025 EPS indicates a year-over-year improvement of 2.3%.ATO’s long-term earnings growth rate is 7.19%. The Zacks Consensus Estimate for fiscal 2025 EPS indicates a year-over-year improvement of 6%.OGS’ long-term earnings growth rate is 5.56%. The Zacks Consensus Estimate for 2025 EPS indicates a year-over-year improvement of 9.7%. 5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>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 Atmos Energy Corporation (ATO): Free Stock Analysis Report UGI Corporation (UGI): Free Stock Analysis Report Spire Inc. (SR): Free Stock Analysis Report ONE Gas, Inc. (OGS): 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