Momentum Stocks Watch: AmeriGas Partners, L.P. (APU)

Company Profile:

AmeriGas Partners, L.P. through its subsidiary, AmeriGas Propane, L.P., distributes propane and related equipment and supplies in the United States. It serves approximately 1.7 million residential, commercial, industrial, agricultural, wholesale, and motor fuel customers in 50 states through approximately 1,900 propane distribution locations. The company’s propane is used for home heating, water heating, and cooking purposes; to fire furnaces, as a cutting gas, and in other process applications; as a supplemental fuel and motor fuel; and for tobacco curing, chicken brooding, crop drying, and orchard heating applications. It also sells, installs, and services propane appliances, such as heating systems; propane-powered generators; and offers residential heating, ventilation, air conditioning, plumbing, and related services. The company markets propane and other services primarily under the AmeriGas, America’s Propane Company, Driving Every Day, Heritage Propane, and Relationships Matter names. AmeriGas Propane, Inc. serves as the general partner of the company. AmeriGas Partners, L.P. was founded in 1994 and is based in King of Prussia, Pennsylvania.

Recent News:

AmeriGas Partners (APU) is trading at a yield of approximately 11.4%. However, the MLP is about to merge with UGI Corporation (UGI). AmeriGas Partners has recommended that its unitholders vote in favor of the merger. A special meeting of AmeriGas unitholders is scheduled for August 21. APU unitholders will receive 0.5 shares of UGI stock and $7.63 in cash for each AmeriGas unit they hold.

The Board of Directors of AmeriGas Propane, Inc. has declared a quarterly partnership distribution of $0.95 per limited partnership unit, payable August 19, 2019 to unitholders of record August 9, 2019.

For the fiscal quarter ended June 30, 2019, the company reported GAAP net loss of $49.0 million, compared with GAAP net loss of $74.4 million in the prior-year period. Based on the results through the first nine months of the year, and expectations for the fourth quarter, the company now expects Adjusted EBITDA in the range of $580 million – $590 million for the fiscal year ending September 30, 2019.

Fundamental Analysis:

Ninestocks analyzes several different financial aspects: Growth, Profitability, solvency and efficiency.

Growth – Measures the growth of both the company’s income statement and cash flow.

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Profitability – Measures the historical price movement of the stock.

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Solvency – Measures the solvency of the company based on several ratios.

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Efficiency – Measures the strength and historic growth of a company’s return on invested capital.

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Conclusion:

APU’s strengths can be seen in its strong profitability compared with its peers. Its revenue has increased over recent several years. Technical indicators signal the bullish signs, as there is a bullish crossover in Stochastic oscillator, the MACD is trying to cross back up and the RSI(14) stands at 36.56 with positive bias. We rate AmeriGas Partners, L.P. (APU) a STRONG BUY.