UGI Corporation (UGI) versus Regency Energy Partners (RGNC) Critical Review

UGI Corporation (NYSE: UGI) and Regency Energy Partners (NASDAQ:RGNC) are both utilities companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, risk, profitabiliy, earnings, institutional ownership, valuation and dividends.

Insider & Institutional Ownership

78.7% of UGI Corporation shares are owned by institutional investors. 2.2% of UGI Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares UGI Corporation and Regency Energy Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
UGI Corporation $5.96 billion 1.49 $1.50 billion $2.63 19.47
Regency Energy Partners N/A N/A N/A N/A N/A

UGI Corporation has higher revenue and earnings than Regency Energy Partners.

Profitability

This table compares UGI Corporation and Regency Energy Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
UGI Corporation 7.84% 11.06% 3.76%
Regency Energy Partners -0.30% -0.47% -0.07%

Dividends

UGI Corporation pays an annual dividend of $1.00 per share and has a dividend yield of 2.0%. Regency Energy Partners does not pay a dividend. UGI Corporation pays out 38.0% of its earnings in the form of a dividend. Regency Energy Partners has raised its dividend for 31 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for UGI Corporation and Regency Energy Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
UGI Corporation 1 1 1 0 2.00
Regency Energy Partners 0 0 0 0 N/A

UGI Corporation currently has a consensus price target of $45.33, suggesting a potential downside of 11.48%. Given UGI Corporation’s higher probable upside, research analysts plainly believe UGI Corporation is more favorable than Regency Energy Partners.

Summary

UGI Corporation beats Regency Energy Partners on 9 of the 11 factors compared between the two stocks.

About UGI Corporation

UGI Corporation is a holding company. The Company distributes, stores, transports and markets energy products and related services. It operates through six segments. The AmeriGas Propane segment consists of the propane distribution business of AmeriGas Partners, L.P. The UGI France segment consists of the French LPG distribution business of its subsidiaries, Antargaz, Finagaz and its liquefied petroleum gases (LPG) distribution businesses. The Flaga & Other segment consists of the LPG distribution businesses of Flaga GmbH, AvantiGas Limited and ChinaGas Partners, L.P. The Energy Services segment consists of energy-related businesses conducted by its subsidiary, UGI Energy Services, LLC (Energy Services). The Electric Generation segment consists of electric generation facilities conducted by Energy Services’ subsidiary. The Gas Utility segment consists of the regulated natural gas distribution businesses of its subsidiary, UGI Utilities, Inc.

About Regency Energy Partners

Regency Energy Partners LP gathers and processes, compress, treats and transports natural gas; transports, fractionates and stores natural gas liquids (NGLs); gathers, transports and terminals oil received from producers; gathers and disposes salt water, and manages coal and natural resource properties in the United States. The Company has six business segments: Gathering and Processing, Natural Gas Transportation, NGL Services, Contract Services, Natural Resources and Corporate. The Gathering and Processing segment provides wellhead-to-market services to producers of natural gas. The Natural Gas Transportation segment owns a 49.99% general partner interest in RIGS Haynesville Partnership Co. The NGL Services segment owns a 30% membership interest in Lone Star NGL LLC. The Contract Services segment owns and operates a fleet of compressors. The Natural Resources segment manages coal and natural resources properties. The Corporate segment includes its corporate assets.

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