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Chesapeake Utilities (CPK)
NYSE:CPK
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Chesapeake Utilities
(NYSE:CPK)
76Outperform
Positive Factors
Credit Rating
CPK received a BBB+ rating from Fitch, indicating a stable credit outlook.
Future Demand
Future rocket launches by Blue Origin, NASA, and SpaceX may require more natural gas, which could increase demand for CPK's pipeline services.
Revenue Growth
Revenue in the Regulated energy segment increased 20.3% year-over-year.
Negative Factors
Interest Expenses
EPS growth was below revenue growth due to higher interest expense and share count to fund the acquisition.
Weather Impact
Revenue from the Regulated Energy segment rose 27.5% year-over-year, below estimates due to warmer-than-average weather which leads to homes using less natural gas to heat water.
Chesapeake Utilities (CPK) vs. S&P 500 (SPY)
Market Cap
$2.92B
Dividend Yield2.02%
Average Volume (3M)126.67K
Price to Earnings (P/E)24.1
Beta (1Y)0.34
Revenue Growth17.72%
EPS Growth11.33%
CountryUS
Employees1,200
SectorUtilities
Sector Strength88
IndustryRegulated Gas
Share Statistics
EPS (TTM)5.26
Shares Outstanding23,011,967
10 Day Avg. Volume165,710
30 Day Avg. Volume126,669
Financial Highlights & Ratios
PEG Ratio2.13
Price to Book (P/B)N/A
Price to Sales (P/S)3.62
Price to Cash Flow (P/CF)32.80
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$131.60Price Target Upside3.22% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
Chesapeake Utilities Business Overview & Revenue Model
Company DescriptionChesapeake Utilities Corporation operates as an energy delivery company. The company operates through two segments, Regulated Energy and Unregulated Energy. The Regulated Energy segment engages in the natural gas distribution operations in central and southern Delaware, Maryland's eastern shore, and Florida; regulated natural gas transmission in the Delmarva Peninsula and Florida; and regulated electric distribution in northeast and northwest Florida. The Unregulated Energy segment engages in the propane operations in the Mid-Atlantic region, North Carolina, South Carolina, and Florida; unregulated natural gas transmission/supply operation in central and eastern Ohio; generation of electricity and steam; and provision of compressed natural gas, liquefied natural gas, and renewable natural gas transportation and pipeline solutions primarily to utilities and pipelines in the eastern United States. This segment also provides other unregulated energy services, such as energy-related merchandise sales; heating, ventilation, and air conditioning services; and plumbing and electrical services. The company was founded in 1859 and is headquartered in Dover, Delaware.
How the Company Makes MoneyChesapeake Utilities makes money primarily through its natural gas and electric distribution segments, which generate revenue from delivering energy to customers via regulated utility operations. The company earns income by charging customers for the consumption of natural gas and electricity, which is regulated by state public service commissions. Additionally, Chesapeake Utilities generates revenue from its unregulated energy businesses, such as propane distribution and energy solutions, which include wholesale marketing and transmission services. The company also benefits from strategic partnerships and investments in energy infrastructure projects, enhancing its ability to provide reliable energy services and contributing to its overall earnings.
Chesapeake Utilities Financial Statement Overview
Summary
Chesapeake Utilities displays strong financial health with impressive revenue growth of 17.40% and improved profit margins. The balance sheet is solid, showing low leverage, although some data for 2024 is unavailable. Cash flow generation is robust, but high capital expenditures could affect future liquidity.Income Statement
Chesapeake Utilities shows strong revenue growth with a significant increase from $670.60M in 2023 to $787.20M in 2024, marking a growth rate of 17.40%. The EBIT margin is robust at 28.98%, and the EBITDA margin stands at 37.58%, indicating efficient operations. Net profit margin improved to 15.07%, reflecting enhanced profitability. Overall, the company demonstrates a strong trajectory in revenue and profit growth.85
Very Positive
Balance Sheet
The company's balance sheet is solid with a debt-to-equity ratio of 0.02, showcasing low leverage. The equity ratio is not available for 2024, but previous years indicate a healthy equity position. Return on equity is approximately 8.53%, suggesting reasonable returns for shareholders. Risks include potential fluctuations in equity due to unavailable asset data for 2024.78
Positive
Cash Flow
Chesapeake Utilities' cash flow is strong with a substantial increase in free cash flow from $14.86M in 2023 to $239.40M in 2024. The operating cash flow to net income ratio is 2.02, indicating robust cash generation relative to net income. However, investing cash flow remains negative, suggesting ongoing capital expenditures which may impact future liquidity.72
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 787.20M | 670.60M | 680.70M | 569.97M | 488.20M | Gross Profit |
| 787.20M | 255.28M | 237.52M | 217.93M | 192.62M | EBIT |
| 228.20M | 150.80M | 142.93M | 131.11M | 112.72M | EBITDA |
| 295.90M | 230.20M | 224.06M | 205.69M | 180.09M | Net Income Common Stockholders |
| 118.60M | 87.21M | 89.80M | 83.47M | 71.50M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 7.90M | 4.90M | 6.20M | 4.98M | 3.50M | Total Assets |
| 3.58B | 3.30B | 2.22B | 2.11B | 1.93B | Total Debt |
| 34.20M | 1.40B | 814.42M | 798.07M | 707.62M | Net Debt |
| 34.20M | 1.39B | 808.22M | 793.09M | 704.12M | Total Liabilities |
| 2.19B | 2.06B | 1.38B | 1.34B | 1.24B | Stockholders Equity |
| 1.39B | 1.25B | 832.80M | 774.13M | 697.09M |
| Cash Flow | Free Cash Flow | |||
| 239.40M | 14.86M | 30.61M | -36.42M | -6.59M | Operating Cash Flow |
| 239.40M | 203.48M | 158.88M | 150.50M | 158.92M | Investing Cash Flow |
| -349.90M | -1.11B | -136.45M | -223.02M | -181.63M | Financing Cash Flow |
| 113.50M | 906.61M | -21.21M | 74.00M | 19.23M |
Chesapeake Utilities Technical Analysis
Positive
127.50
Price Trends
125.59
Positive
124.66
Positive
120.42
Positive
Market Momentum
0.75
Negative
61.78
Neutral
86.18
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CPK, the sentiment is Positive. The current price of 127.5 is above the 20-day moving average (MA) of 127.18, above the 50-day MA of 125.59, and above the 200-day MA of 120.42, indicating a bullish trend. The MACD of 0.75 indicates Negative momentum. The RSI at 61.78 is Neutral, neither overbought nor oversold. The STOCH value of 86.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CPK.
Chesapeake Utilities Risk Analysis
Chesapeake Utilities disclosed 37 risk factors in its most recent earnings report. Chesapeake Utilities reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Chesapeake Utilities Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $2.84B | 14.69 | 12.46% | 2.38% | 30.48% | 267.73% | |
76 Outperform | $2.92B | 24.08 | 9.00% | 2.02% | 17.72% | 11.33% | |
69 Neutral | $2.89B | 23.71 | 14.01% | 2.43% | -0.04% | -5.82% | |
68 Neutral | $3.42B | 15.25 | 7.94% | 4.69% | 6.45% | 13.95% | |
65 Neutral | $11.78B | 15.57 | 6.20% | 4.58% | 5.53% | -8.93% | |
63 Neutral | $3.25B | 26.77 | 10.17% | 2.00% | -1.95% | 2.33% | |
56 Neutral | $3.19B | 17.39 | 7.09% | 4.82% | 10.64% | 2.28% |
* Utilities Sector Average
Performance Comparison
CPK
Chesapeake Utilities
127.50
28.91
29.32%
AWR
American States Water
75.71
8.82
13.19%
AVA
Avista
40.14
7.66
23.58%
CWT
California Water Service
48.50
4.54
10.33%
MGEE
MGE Energy
87.77
13.72
18.53%
NWE
Northwestern
55.67
9.05
19.41%
Chesapeake Utilities Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: 1.24% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
Chesapeake Utilities experienced a year of significant growth with record capital investment, successful acquisition integration, and strong customer growth. Despite challenges such as higher operating and interest expenses, and rate case delays, the company demonstrated robust financial performance and favorable regulatory outcomes.Highlights
Record Capital Investment
Chesapeake Utilities invested $356 million in capital in 2024, a record amount, and at the upper end of their annual guidance range of $300 million to $360 million.
Florida City Gas Acquisition Success
The acquisition of Florida City Gas contributed nearly $89 million in 2024 adjusted gross margin and led to significant operational and cultural integration success.
Strong Customer Growth
In Delmarva, over 4,000 new customers were added, driving residential growth by 4% and commercial growth by 1.6%. In Florida, 6,700 new customers were added, with residential and commercial growth of 3.9% and 1.2%, respectively.
Positive Financial Performance
Adjusted gross margin was $567 million, up 25% from 2023, and adjusted net income increased by 24% to approximately $122 million.
Favorable Regulatory Developments
Approval for $80 million Worcester Resiliency upgrade LNG storage project and Miami Interloop projects totaling $40 million.
Lowlights
Higher Operating Expenses
Increased operating expenses by $1.52 per share due to the integration of Florida City Gas, along with higher insurance, facilities, and vehicle expenses.
Increased Interest Expenses
Chesapeake Utilities faced increased interest expenses of $1.15 per share due to financing activities amidst a higher interest rate environment.
Rate Case Delays
A delay in the finalization of the Maryland rate case affected financial outcomes, although interim rate relief was received in Delaware and Florida.
Company Guidance
During Chesapeake Utilities Corporation's Fourth Quarter and Full Year 2024 Earnings Conference Call, the company provided several key metrics and guidance for 2025. Adjusted diluted earnings per share for 2024 reached $5.39, aligning with the midpoint of their guidance range. The company invested a record $356 million in capital throughout the year, targeting a five-year capital investment plan of $1.5 to $1.8 billion through 2028. For 2025, capital expenditure guidance was set between $325 and $375 million. Chesapeake Utilities reaffirmed its 2025 earnings per share guidance range of $6.15 to $6.35, indicating a 16% growth rate at the midpoint. The company also highlighted a strong balance sheet with an equity to total capitalization ratio of 48.4% and emphasized its commitment to increasing this ratio to 50% by the end of the year. Additionally, they discussed regulatory advancements, such as receiving FERC approval for an $80 million LNG storage project and active rate case filings, which are expected to support future growth and performance.Chesapeake Utilities Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Chesapeake Utilities Reports Strong 2024 Financial Results
Positive
Feb 26, 2025
Chesapeake Utilities Corporation reported its financial results for the year and fourth quarter ending December 31, 2024. The company achieved a net income of $118.6 million for the year, with significant contributions from the acquisition of Florida City Gas and growth in natural gas distribution. The company met its earnings guidance and capital structure targets, delivering a 17% annual shareholder return. The results reflect successful integration of acquisitions and expansion in service areas, positioning Chesapeake Utilities for future growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.