Chesapeake Utilities’ Stock Up 5.6% – Strong Fundamentals Could be the Reason?
June 10, 2023
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Chesapeake Utilities ($NYSE:CPK) Corporation has seen a 5.6% rise in its stock price over the past three months, which has left investors wondering if strong fundamentals have been the driving force behind this modest growth. Chesapeake Utilities is an energy and utility services provider that operates in the Mid-Atlantic and Southeast regions of the United States. The company’s primary lines of business include the distribution of natural gas, propane, electricity, and other energy products, as well as the transmission of these products. The company has a strong balance sheet with no long-term debt and ample liquidity, allowing for greater flexibility in their operations. Chesapeake Utilities’ impressive fundamentals suggest that this could be the reason behind the modest stock performance over the last few months.
The company’s strong financial standing and commitment to investment quality have created a platform for future growth and success. With a commitment to innovation and customer service, Chesapeake Utilities continues to diversify its services while maintaining cost-efficiencies and staying ahead of industry trends. It’s no surprise that investors are taking notice and increasing their stake in the company’s stock.
Analysis
At GoodWhale, we have conducted an analysis of CHESAPEAKE UTILITIES and our Star Chart has classified them as a ‘gorilla’. This type of company generally has the capability to achieve stable and high revenue or earnings growth due to their strong competitive advantage. We have assigned CHESAPEAKE UTILITIES an intermediate health score of 5 out of 10. This indicates that the company is likely to be able to pay off its debt and fund future operations. We also found that they were strong in dividend and profitability, and medium in asset and growth. Investors who are looking for stable returns and high growth potential may find CHESAPEAKE UTILITIES to be a good investment opportunity. Furthermore, their ability to manage debt and generate cashflows makes them a reliable company for long-term investments. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Chesapeake Utilities. More…
| Total Revenues | Net Income | Net Margin |
| 675.95 | 89.21 | 13.2% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Chesapeake Utilities. More…
| Operations | Investing | Financing |
| 171.43 | -149.17 | -24.41 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Chesapeake Utilities. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.2k | 1.34k | 48.3 |
Key Ratios Snapshot
Some of the financial key ratios for Chesapeake Utilities are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 12.7% | 11.1% | 21.2% |
| FCF Margin | ROE | ROA |
| 4.5% | 10.6% | 4.1% |
Peers
The competition between Chesapeake Utilities Corp and its competitors is fierce. CF Energy Corp, Alliant Energy Corp, AS Latvijas Gaze are all fighting for market share in the competitive landscape.
– CF Energy Corp ($TSXV:CFY)
Calgary-based Cenovus Energy Inc. is a Canadian integrated oil and gas company. It is engaged in the development, production and marketing of crude oil, natural gas and natural gas liquids in Canada. Cenovus has two major operating areas: the oil sands in northern Alberta, which it uses advanced in situ methods to produce bitumen (a heavy oil), and its conventional oil and gas assets in Alberta and Saskatchewan. The company also has a 50% interest in two U.S. refineries.
– Alliant Energy Corp ($NASDAQ:LNT)
Alliant Energy Corporation is a public utility holding company that owns two electric and natural gas utilities, serving more than one million customers in Iowa and Wisconsin. Alliant Energy’s mission is to deliver the energy solutions and services customers and communities count on – safely, efficiently and responsibly. The company’s ROE is 10.06%.
– AS Latvijas Gaze ($LTS:0J4R)
Latvijas Gaze is a Latvian natural gas utility company. It is the largest Latvian gas supplier, with a market share of around 70%. The company is also the largest shareholder of Conexus Baltic Grid, the operator of Latvia’s natural gas transmission and storage system.
Latvijas Gaze has a market capitalization of 319.2 million as of 2022. The company’s return on equity was 12.15% as of the same year.
Latvijas Gaze is engaged in the import, export, storage, and distribution of natural gas in Latvia. The company also owns and operates a gas transmission system and a gas storage facility in the country. In addition, Latvijas Gaze provides gas-related services, such as gas metering, gas quality testing, and gas safety inspection.
Summary
Chesapeake Utilities Corporation’s stock performance has been positive over the past three months, up 5.6%. Its fundamentals appear to show strong financial health, with a consistent increase in operating cash flow, an expanding operating margin, rising return on equity, and a solid balance sheet. The company also has a low debt-to-equity ratio and has increased its dividend payout in the past year. Analysts consider CHESAPEAKE UTILITIES a good investment opportunity, predicting the stock will likely continue to climb in the near future.
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