Here's Why You Should Add Atmos Energy Stock to Your Portfolio Now

Atmos Energy Corporation’s ATO strategic investment plans should further increase the safety and reliability of its natural gas pipelines and distribution and transportation systems. Solid contributions from residential customers help boost the company’s top line. Given its growth opportunities, ATO makes for a solid investment option in the utility sector.Let’s focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment.ATO’s Growth Projections & Surprise HistoryThe Zacks Consensus Estimate for fiscal 2025 earnings per share (EPS) has increased 0.8% to $7.17 in the past 90 days.The Zacks Consensus Estimate for fiscal 2025 sales is pinned at $5.07 billion, implying a year-over-year increase of 21.6%.The company’s long-term (three-to-five-year) earnings growth rate is 7%. It delivered an average earnings surprise of 3.4% in the trailing four quarters.Debt Position of ATOCurrently, ATO’s total debt to capital is 39.3%, better than the industry’s average of 50.49%.The time-to-interest earned ratio at the end of the fiscal fourth quarter of 2024 was 7.5. The ratio, being greater than one, reflects the company’s ability to meet future interest obligations without difficulties.ATO’s Dividend HistoryATO has been increasing shareholder value via regular dividend payments. In November 2024, the company’s board declared an 8.8% increase in the annual dividend rate. Its new quarterly dividend is 87 cents per share. This resulted in an annualized dividend of $3.48 per share compared with the previous year's $3.22. The company has raised its annual dividend for 40 consecutive years and paid quarterly dividends for 164 years.Atmos Energy aims to increase its dividend by 6-8% per year through fiscal 2026, subject to the approval of the board of directors. Its current dividend yield is 2.48%, better than the Zacks S&P 500 Composite’s 1.18%.ATO’s Systematic InvestmentsThe company’s systematic capital expenditure plan to enhance the safety and reliability of its natural gas pipelines helps serve its expanding customer base more efficiently.  ATO expects $3.7 billion in capital expenditures during fiscal 2025 and plans to invest $24 billion during fiscal 2025-2029 to strengthen its operations. The planned investment should result in 6-8% annual earnings growth during the same period.ATO’s Price PerformanceIn the past six months, Atmos Energy’s shares have risen 20.7% compared with the industry’s 14.8% growth.   Image Source: Zacks Investment ResearchOther Stocks to ConsiderA few other top-ranked stocks from the same sector are ONE Gas, Inc. OGS, New Jersey Resources NJR and CenterPoint Energy CNP. Each stock presently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The Zacks Consensus Estimate for OGS’ 2024 EPS has increased 1% to $3.88 in the past 60 days. The Zacks Consensus Estimate for fourth-quarter sales indicates an increase of 8.1% from the prior-year registered figure.  The Zacks Consensus Estimate for NJR’s fiscal 2025 EPS indicates year-over-year growth of 1%. The Zacks Consensus Estimate for NJR’s fiscal 2025 sales indicates an increase of 2.6% from the previous year’s registered figure.  CNP’s long-term earnings growth rate is 7.12%. The Zacks Consensus Estimate for 2024 EPS indicates year-over-year growth of 8%. Free Report: 5 Clean Energy Stocks with Massive UpsideEnergy is the backbone of our economy. It’s a multi-trillion dollar industry that has created some of the world’s largest and most profitable companies.Now state-of-the-art technology is paving the way for clean energy sources to overtake “old-fashioned” fossil fuels. Trillions of dollars are already pouring into clean energy initiatives, from solar power to hydrogen fuel cells.Emerging leaders from this space could be some of the most exciting stocks in your portfolio.Download Nuclear to Solar: 5 Stocks Powering the Future to see Zacks’ top picks free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CenterPoint Energy, Inc. (CNP): Free Stock Analysis Report Atmos Energy Corporation (ATO): Free Stock Analysis Report NewJersey Resources Corporation (NJR): Free Stock Analysis Report ONE Gas, Inc. (OGS): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks