New Jersey Resources' (NJR) Unit Files for Gas Rate Revision

Group 1: Rate Revision and Impact - New Jersey Natural Gas (NJNG) has filed for a rate revision with the New Jersey Board of Public Utilities (BPU), which, if approved, will increase the utility bill of a typical residential customer using 100 therms a month by 0.5% or 71 cents per month, effective from October 1, 2024 [1] - NJNG is seeking a reduction in its annual Basic Gas Supply Service (BGSS) rate, offset by an increase to its Balancing Charge, with a minimal decrease of 0.1% related to the Conservation Incentive Program (CIP) due to warmer-than-normal winter weather [2][3] - NJNG aims for a 0.6% increase in its energy-efficiency recovery filing to cover costs associated with its SAVEGREEN programs [2] Group 2: Capital Investments - New Jersey Resources plans capital investments between $619 million and $754 million for fiscal 2024 and between $578 million and $742 million for fiscal 2025, aimed at upgrading and maintaining infrastructure to support an expanding customer base [4] - Systematic capital expenditure is expected to support a long-term earnings growth target of 7-9% [4] Group 3: Industry Demand and Growth Opportunities - The demand for natural gas is increasing due to its clean-burning nature, wide availability, and rising awareness against emissions, with one residential customer signing up for natural gas service every minute and 80 businesses adding natural gas service each day [6] - The rising demand for natural gas presents growth opportunities for companies like Atmos Energy Corporation (ATO), MDU Resources (MDU), and UGI Corporation (UGI), each currently holding a Zacks Rank 2 (Buy) [7] - The current dividend yields for Atmos Energy, MDU Resources, and UGI are 2.78%, 1.98%, and 5.89%, respectively, outperforming the Zacks S&P 500 composite's yield of 1.57% [7] Group 4: Earnings Estimates - The Zacks Consensus Estimate for fiscal 2024 earnings per share has increased for ATO, MDU, and UGI by 0.9%, 1.3%, and 2.1%, respectively, over the past 60 days [8]