This Ultra-High-Yield Stock Is Dirt Cheap -- and Wall Street Thinks It Will Soar 32% Over the Next 12 Months

Core Viewpoint - UGI Corporation is highlighted as an attractive investment for income investors due to its high dividend yield, low valuation, and potential for share price growth [2][11]. Company Overview - UGI Corporation is a utility company involved in natural gas transmission and distribution, electricity generation and distribution, and propane distribution, with a history dating back to 1882 [3]. Dividend and Valuation - UGI offers a forward dividend yield of 6.42% and has a long history of paying dividends for 139 consecutive years, increasing them for 36 consecutive years [4]. - The stock is valued at 7.4 times forward earnings, with a price-to-sales ratio of 0.68 and a price-to-book ratio of 1.07, indicating it is attractively priced compared to peers [4][5]. Market Performance - UGI's share price has decreased by approximately 5% year-to-date, while the Utilities Select SPDR ETF has increased by nearly 22% in 2024 [6]. - Despite this underperformance, analysts project a 12-month price target reflecting a 32% upside potential for UGI [6][8]. Analyst Sentiment - Among five analysts surveyed, only one rated UGI as a strong buy, while three recommended holding and one suggested it as an underperformer [7]. - The lowest 12-month price target among analysts is still 16% higher than the current share price, indicating a general expectation of price appreciation [8]. Investment Suitability - UGI may not appeal to growth investors due to its business model, but it is considered attractive for value investors due to its low valuation [9][10]. - Income investors are likely to find UGI appealing due to its secure ultra-high dividend yield and strong track record of dividend payments [11].