Mizuho raises UGI Corporation stock price target to $41 on AmeriGas improvements

Published 15/07/2025, 13:08
Mizuho raises UGI Corporation stock price target to $41 on AmeriGas improvements

Investing.com - Mizuho (NYSE:MFG) raised its price target on UGI Corporation (NYSE:UGI) to $41.00 from $39.00 on Tuesday, while maintaining an Outperform rating on the stock. The new target reflects potential upside for UGI, which is currently trading near its 52-week high of $36.74 and has delivered an impressive 63% return over the past year. According to InvestingPro analysis, the stock appears slightly undervalued at current levels.

The price target increase follows several developments that Mizuho had previously identified as potential catalysts for the company, including the refinancing of AmeriGas’ 2026 notes and the execution of propane asset sales at AmeriGas Hawaii and UGI International Italy.

These actions are expected to continue deleveraging AmeriGas’ balance sheet, which, combined with anticipated modest operational improvements, should increase AmeriGas equity value and unlock further sum-of-the-parts valuation at UGI, according to Mizuho.

The research firm expects UGI to modestly exceed the upper end of its fiscal year 2025 guidance, while largely maintaining its fiscal 2026 and 2027 estimates.

Mizuho also noted that the recent rate case settlement at UGI’s Pennsylvania utility is positive, though largely in line with expectations.

In other recent news, UGI Corporation reported strong financial results for the second quarter of 2025, with earnings per share (EPS) reaching $2.21, surpassing analysts’ expectations of $1.96. Despite this earnings beat, the company fell short of revenue forecasts, reporting $2.67 billion against a projected $3.26 billion. UGI raised its fiscal 2025 EPS guidance to a range of $3.00 to $3.15, reflecting optimism about future growth. Meanwhile, AmeriGas Propane, a UGI subsidiary, has agreed to sell its Hawaii operations to Isle Gas, a subsidiary of AMF Hawaii Investment Holdings managed by Argo Infrastructure Partners. This transaction includes 750,000 gallons of propane storage facilities and a delivery fleet, with proceeds aimed at reducing AmeriGas’s debt. The sale is expected to close in the fourth quarter of fiscal 2025. Analyst firms have not provided updates on stock upgrades or downgrades following these announcements. These developments reflect strategic moves by UGI and AmeriGas to optimize their operations and financial performance.

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