Morningstar Rating

Stock Research and Analysis

by Mark Barnett

Bulls Say

Healthy and consistent regulated cash flows give the company some room for modest dividend increases.
AGL could be in a position to invest significant capital in new FERC pipelines at returns above state-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 rate 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 higher returns from usage changes.
We think AGL diluted the quality of its overall regulatory environment with the Nicor acquisition and could face a negative 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 profitability for AGL's facilities continues to deteriorate. Read more 

Management

We believe AGL's stewardship of investors' capital had been very good, but the Nicor deal was an exercise in empire building and that returns on invested capital could suffer as a result, though management has already had material success addressing   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 

A Favorable Wind Blowing for This Utility 
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