ONE Gas (OGS – Research Report), the Utilities sector company, was revisited by a Wall Street analyst yesterday. Analyst Sarah Akers from Wells Fargo remains neutral on the stock and has a $60.00 price target.
Sarah Akers’ Hold rating for ONE Gas stock is shaped by a mix of elements including heightened capital expenditure and financing requirements, which contribute to a greater regulatory lag. While management remains optimistic about long-term growth and anticipates an improvement in macroeconomic pressures and customer growth, these factors are tempered by the projected EPS growth rate reduction. Akers is cautious due to the company’s recent departure from its previous pattern of reliable results and strong performance since its 2014 spin-out.
The analyst’s valuation perspective is influenced by the company’s current share price movement, which has brought its valuation in line with its peers, despite historically being seen as a premium utility. Akers notes that the lack of significant EPS growth expected for fiscal year 2024 and the downward revision of growth outlook have diminished her enthusiasm for the stock. The reiteration of the Equal Weight rating and the lowering of the price target to $60 reflect these revised EPS estimates and the application of a market-average multiple, as opposed to the premium previously assigned.
In another report released on November 21, Mizuho Securities also assigned a Hold rating to the stock with a $67.00 price target.
OGS’s price has also changed moderately for the past six months – from $81.420 to $57.630, which is a -29.22% drop .
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ONE Gas (OGS) Company Description:
ONE Gas, Inc. engages in the provision of natural gas distribution services. It also offers natural gas to residential, commercial, industrial, and transportation customers. The company was founded in 1906 and is headquartered in Tulsa, OK.
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