StarGas Partners LP operates as a home heating oil and propane distributor and services provider to residential and commercial customers in the United States. The company was founded in 1995 and is based in Stamford, Connecticut.
SGU Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for SGU, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Star Group Lp ranked in the 85th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. As for the metrics that stood out in our discounted cash flow analysis of Star Group Lp, consider:
Star Group Lp's weighted average cost of capital (WACC) is 6%; for context, that number is higher than only 5.59% of tickers in our DCF set.
Star Group Lp's effective tax rate, as measured by taxes paid relative to net income, is at 20 -- greater than 82.71% of US stocks with positive free cash flow.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than only 19.16% of stocks in its sector (Energy).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Energy that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as SGU, try CVI, MMLP, BTE, TOT, and HFC.