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Investing.com - Jefferies raised its price target on UGI Corporation (NYSE:UGI) to $45.00 from $44.00 on Wednesday, while maintaining a Buy rating on the stock. Currently trading at $34.92, UGI appears undervalued according to InvestingPro analysis, with the stock showing impressive 50% total return over the past year.
The firm cited the clearing of utility M&A acquisition overhang as a key factor in its continued bullish outlook on the company. Jefferies remains positive despite noting that fiscal year 2026 earnings per share are expected to be flat or declining after a strong $3.23 in fiscal year 2025.
UGI faces tax headwinds of 25-35 cents year-over-year, which Jefferies believes will lead to earnings of approximately $3.17 per share for fiscal year 2026. This falls within the firm’s initiated guidance range of $2.85-$3.15, compared to the current consensus of $3.18-$3.20.
Jefferies highlighted several focus areas for UGI including AmeriGas fiscal year 2026 guidance (estimated at approximately $400 million), midstream-data center opportunities, continued leverage reduction, and potential further asset sales.
The research firm continues to view UGI as an "uncorrelated, deep value opportunity" in the market, despite the challenges identified in its forward earnings outlook.
In other recent news, UGI Corporation has reported significant developments involving its subsidiary and international operations. UGI’s indirect, wholly-owned subsidiary, AmeriGas Propane, L.P., has entered into a third amendment to its Revolving Credit and Security Agreement. The amendment, dated November 10, 2025, involves changes to the "Fixed Charge Coverage Ratio" calculation, excluding certain dividends and distributions up to specified limits for the fiscal years ending September 30, 2026, and September 30, 2027. This amendment could potentially affect the financial calculations related to AmeriGas Propane’s credit agreement.
Additionally, UGI International, LLC, a part of UGI Corporation, has reached a definitive agreement to sell its LPG distribution business in Austria to DCC, plc for an enterprise value of €55 million ($60 million). This sale is part of UGI International’s strategy to streamline its portfolio, aiming to create a more focused business operation. The proceeds from this transaction are intended to reduce debt and enhance financial flexibility for future investments. These recent developments reflect UGI Corporation’s ongoing efforts to optimize its financial and operational strategies.
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