Morningstar Rating

Stock Research and Analysis

by Mark Barnett

Bulls Say

Healthy and consistent regulated cash flows give the company room for modest dividend increases.
AGL could be in a position to invest significant capital in new pipeline at returns above regulated returns on capital.
Decoupled rate structures in Georgia, its largest territory, and Virginia make AGL one of the steadier performers in the industry. AGL is making major improvements to its Illinois business as well. Read more 

Bears Say

While decoupled rate structures ensure more stable results, they inhibit a utility company's ability to generate abnormally high returns.
We think AGL diluted the quality of its overall regulatory environment with the Nicor acquisition and could face a rude surprise when it must finally go in for a full rate case.
The push for new storage development could not have happened at a worse time for storage fundamentals, as rates for AGL's facilities continue to suffer. Read more 

Management

We believe AGL's stewardship of investors' capital had been very good, but we are worried that the Nicor deal was an exercise in empire building and that returns on invested capital will suffer, and we are wary of possible further acquisitions. AGL   Read more 

Profile

AGL Resources is an energy services holding company with regulated natural gas utilities in Florida, Georgia, Illinois, Maryland, New Jersey, Tennessee, and Virginia. Its   Read more 

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