Atmos Energy Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Atmos Energy continues to compound earnings effectively — FY2025 EPS of $7.46 grew 9.2% YoY with operating margin expanding to 33.2%, and Q3 FY2026 delivered another beat at $1.43 vs a $1.35 estimate.
However, the stock trades at a 28.5% PE premium and a 156% P/S premium to the regulated-gas peer median as of the latest composite, which is difficult to justify given persistent negative free cash flow of -$1.51B in FY2025 against $3.56B of capex and total debt of $9.30B. With the price at $161.66 still below both the 50-day ($164.95) and 200-day ($174.28) moving averages as of 9 Oct despite a recovering RSI of 52.3 and a positive MACD histogram, the setup is improving but not yet compelling enough to chase at this valuation.
What could go wrong
- Valuation premium. ATO trades at 19.04x PE vs peer median 14.82x (28.5% premium) and 5.48x P/S vs 2.14x median (156% premium), leaving little room for execution missteps.
- Persistent negative FCF. Free cash flow was -$1.51B in FY2025 and has been negative in four of the last five fiscal years, driven by capex of $3.56B in FY2025.
- Rising leverage. Total debt grew from $8.13B in FY2024 to $9.30B in FY2025, funding the heavy capital program.
- Insider net selling. Over the past 24 months, insider transactions net to -15,150 shares and -$2.29M in value, with no cluster buy signal.
What would change my mind
Where this comes from: FY25 fundamentals · Q3 FY26 results and earnings vs estimates · peer comparison · technicals, 9 Oct. Orin's read on ATO; not advice.
How has the share price moved?
Down 2.8% over twelve months, from $176.35 on 27 Oct 2025 to $171.37 at the Tue 27 Oct 2026 close. Its highest close in that time was $192.29 on 9 Apr 2026; the last close is 10.9% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 6.5M, on 29 May 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All ATO filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $2.6B | 0.0% |
| State Street | $2.0B | 0.1% |
| Vanguard Capital Management | $1.9B | 0.0% |
| Vanguard Portfolio Management | $1.6B | 0.1% |
| Wellington Management Group | $1.6B | 0.3% |
| Geode Capital Management | $770.3M | 0.0% |
| Bank of America | $720.2M | 0.0% |
| Invesco | $546.7M | 0.0% |
| Morgan Stanley | $493.3M | 0.0% |
| T. Rowe Price Associates | $427.5M | 0.0% |
98 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 98 Form 4 filings; open-market trades net −$2.3M. Of the 50 on hand, 1 was an open-market purchase and 0 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about ATO
Orin answers questions about ATO from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 20.6× its last 12 months of profit (Thu 5 Nov close) — higher than in 4 of its last 5 fiscal years (middle 18.1×); the typical Utilities company on the NYSE is at 18.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 20.6×above usual | 18.1× | 18.5× |
| P/S | 6.01×above usual | 3.60× | — |
| EV/EBITDA | 14.7×above usual | 13.8× | — |
| P/B | 1.9×above usual | 1.5× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $182 (from $167 to $200) — 6% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$182
$167 – $200 · +6% against the last close
- 1 buy or overweight
- 11 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 20.6× its last 12 months of profit; the middle P/E of the 8 companies it is compared to that made a profit is 16.8×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| ATOAtmos Energy Corporation | $30B | 20.6× | 14.7× | 61.0% | 28.5% | 10% |
| CPKChesapeake Utilities Corporation | $3B | 22.2× | 9.2× | 36.3% | 15.1% | 9% |
| NINiSource Inc. | $21B | 23.0× | 12.0× | 50.8% | 13.2% | 10% |
| NJRNew Jersey Resources Corporation | $5B | 14.6× | 11.7× | 28.3% | 16.4% | 14% |
| NWNNorthwest Natural Holding Company | $2B | 16.8× | 10.0× | 54.4% | 9.7% | 8% |
| OGSONE Gas, Inc. | $5B | 16.8× | 10.6× | 74.6% | 12.5% | 8% |
| SRSpire Inc. | $5B | 9.6× | 14.1× | 32.7% | 21.6% | 16% |
| SWXSouthwest Gas Holdings, Inc. | $7B | 25.1× | 12.6× | 65.3% | 15.2% | 6% |
| UGIUGI Corporation | $8B | 12.6× | 9.5× | 46.7% | 9.2% | 13% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 20.6× its last 12 months of profit (Thu 5 Nov close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now20.6×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Utilities companies on the NYSE were priced at a typical 18.5× their yearly profit (Tue 27 Oct close).
- Now18.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
It spends more cash than it brings in, so a cash-flow model gives no usable value (both versions come out below zero).
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.