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More Reading from MarketBeat Utility Gas Inflation Is Soaring. This Stock Is a Clear WinnerBy Jordan Chussler. Publication Date: 1/20/2026. 
Key Points - Last month’s Consumer Price Index report showed inflation for piped utility has increased 10.8% year-over-year.
- That bodes well for Atmos Energy, the largest natural-gas-only utility in the United States.
- Over the past year, the stock’s 17% gain has outperformed the S&P 500 while its dividend is on the verge of joining an exclusive club.
On Jan. 13, the U.S. Bureau of Labor Statistics released December's Consumer Price Index data, showing headline inflation rising at a year-over-year (YOY) pace of 2.7%. While there were some bright spots, including gasoline deflation of -3.4%, one figure stood out: piped utility gas services rose a staggering 10.8% YOY. A widely followed Wall Street analyst is highlighting AES Corp (AES) as a stock to watch right now, based on signals from his proprietary Power Gauge system. The model tracks factors like momentum, financial strength, and institutional activity across thousands of U.S. stocks.
He breaks down the full reasoning in a short briefing, including why AES is showing unusual strength at this stage of the market. See the full analysis here That isn't welcome news for Americans already facing elevated utility bills, especially as the depths of winter increase home heating needs. It could, however, be positive for shareholders of the largest natural gas-only utility in the United States. Why Utility Gas Prices Are Surging Although 10.8% YOY inflation is painful for consumers, it reflects a global trend. Utility gas prices are climbing worldwide as demand for liquefied natural gas (LNG) grows. Even though the U.S. benchmark has eased somewhat year to date (-2.94%), European and U.K. benchmarks have risen roughly 25% and 26%, respectively. U.S. LNG futures have surged about 17% since Jan. 16 amid an Arctic blast that has left much of the continental United States under freezing conditions. Prices have been driven higher by limited domestic supply, rising production costs, and increased U.S. LNG exports. On Jan. 2, Reuters reported that in 2025 the United States became the first country to export more than 100 million metric tons of LNG. Another structural demand source is AI data centers, which rely on LNG among other energy inputs for power generation and cooling. According to Natural Gas Intelligence, data centers currently consume more than 1 billion cubic feet per day (Bcf/d) of natural gas. By 2030, that figure is forecast to rise to between 4 Bcf/d and 8 Bcf/d. All told, the widening supply-demand gap should continue to benefit companies positioned to profit from higher natural gas prices. A 120-Year-Old Utility Company That Packs a Growth Punch Founded in 1906 as the Amarillo Gas Company, Atmos Energy (NYSE: ATO)—now headquartered in Dallas—delivers natural gas to more than 3.3 million residential, commercial, and industrial customers across nine states via an extensive pipeline network for heating, cooking, and industrial processes. The utility serves roughly 1,400 communities from the Blue Ridge Mountains to the Rocky Mountains. Its core services include gas delivery, system integrity and maintenance, storage and transmission connections, and customer programs such as billing, conservation, and energy-efficiency offerings. In the past fiscal year, Atmos Energy's earnings per share (EPS) rose more than 9.2%, revenue grew nearly 13%, and net income increased almost 15%. Those results have helped keep ATO in TradeSmith's Green Zone for over 12 months. The stock has gained more than 17% during that period and over 47% since the start of 2025. Meanwhile, the company continues to reward shareholders with consistent dividend increases. A Dividend Aristocrat With a 41-Year Track Record Utility stocks are often viewed as defensive—with modest share appreciation but relatively generous dividends. Atmos Energy has shown elements of both: its one-year gain has outpaced the S&P 500's roughly 14% return, behaving at times more like a growth stock, while also delivering steady income. The Dividend Aristocrat yields 2.35% (about $4 per share annually) and has increased its payout for 41 consecutive years. Its annualized five-year dividend growth rate is 8.63%, and a dividend payout ratio just above 53% is viewed as healthy and sustainable. What Wall Street Thinks About Atmos Energy Among 14 analysts covering the stock, Atmos Energy carries a consensus Hold rating: three analysts rate it Buy, 11 rate it Hold, and none rate it Sell. The average 12-month price target implies only about 1.7% upside. Still, with trailing EPS of $7.49 and a price-to-earnings (P/E) ratio of 22.75, analysts expect earnings to rise roughly 7.7% next year, from $7.18 to about $7.73 per share. Institutional ownership is high at 90.17%, with inflows of $4.62 billion outpacing outflows of $2.82 billion. Low short interest (3.19% of the float) suggests limited bearish positioning. Atmos Energy ranks higher than 88% of companies evaluated by MarketBeat and sits 26th out of 89 stocks in the utilities sector.
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