Daily Stock Analysis: UGI Corporation

The portfolio of stocks I started building on September 8, at a one stock per week pace for the next year, is named Vista.  I will select its ninth stock this coming weekend. Vista is the sixth portfolio I've built (at a one dividend dog per-week pace) since 2014. Six portfolios = VI for Vista!

Vista is planned to Look Ahead for Outstanding, Proven, Dividend Winners. (Like Aristocrats)

Today we'll review the first of five utility sector stock candidates vying to be that tenth selection and only utility member of the Vista portfolio.

My subject today is a mid-cap regulated gas utility, named UGI Corp. Its trading ticker symbol is UGI. This is my first report on UGI Corp for any of my portfolios.

UGI Corp is an American holding company that, through its subsidiaries, is involved in the transport and marketing of energy and related services. 

UGI Corp's Gas Utility and Midstream & Marketing divisions account for the vast majority of its total revenue. The Gas Utility business engages in the regulated distribution and transmission of natural gas to, primarily, the states of Pennsylvania and Maryland. 

UGI Corp's Midstream & Marketing division encompasses its Energy Services and Electric Generation activities. Within Energy Services, the company sells mainly natural gas to Mid-Atlantic and South Atlantic states through its own processing, storage, and pipeline facilities. This division also generates and sells electricity through its portfolio of thermal power plants.

It also manages natural gas pipeline and storage contracts; develops, owns, and operates pipelines, gathering infrastructure, and gas storage facilities; and offers heating, ventilation, air conditioning, refrigeration, mechanical, and electrical contracting services. 

UGI Corporation was founded in 1882 and is headquartered in King of Prussia, Pennsylvania.

I use three key data points to gauge dividend equities or funds like UGI Corp:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether a company has made, is making, and will make money. 

UGI Price

UGI's price per share closed at $34.36 yesterday. A year ago its price was $46.23. Price fell $11.87 or about 25.7% last year.

If UGI's stock trades in the range of $22 to $42 this next year, its recent $34.36 price might rise by $5.64 to reach $40.00 by November 10, 2021. 

UGI Dividends

UGI's most recently declared quarterly dividend was $0.33 paid on October 1st. Dividends are estimated to total $1.32 per share annually and yield 3.84% at yesterday's $34.36 closing price.

UGI Gains?

Adding the $1.32 annual anticipated dividend to my $5.64 optimistic estimate of UGI Corp's price upside shows a $6.96 potential gross gain, per share, to be reduced by any costs to trade the shares.  

Put little under $1,000.00 today in UGI Corp at $34.36 and we would buy 29 shares of UGI stock.

A $10 broker fee (if any) paid half at purchase and half at sale could cost us about $0.34 per share.

Subtract that $0.34 brokerage cost from my estimated $6.96 gross gain per share results in a net gain of $6.62 X 29 shares = $191.98 for a 19.2% net gain on a $996.44 investment.

So it goes that UGI Corp shows a possible 19.2% net gain including a 3.84% dividend yield. It could be more, it could be less.      

All of the estimates above are speculation based on the past history of UGI Corp. Only time and money invested in this stock will determine its worth.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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