Ultrapar Participacoes (NYSE:UGP) Shares Gap Up - Still a Buy?

Key Points

• UGP shares opened higher, rising from a prior close of $6.45 to $6.70 before last trading near $6.67.
• Analyst sentiment is broadly positive, with an average “Moderate Buy” rating and a $6.40 price target; Bank of America upgraded the stock to “buy” with a $7.40 target, while Goldman Sachs maintained a neutral view with a $5.80 target.
• Ultrapar modestly beat quarterly earnings expectations, reporting $0.28 in EPS versus $0.27 expected, while generating $8 billion in revenue. The company also announced a $0.1932 dividend, representing a 50.82% payout ratio.

Ultrapar Participacoes S.A. (NYSE:UGP - Get Free Report) gapped up before the market opened on Monday . The stock had previously closed at $6.45, but opened at $6.70. Ultrapar Participacoes shares last traded at $6.6650, with a volume of 298,712 shares.

Wall Street Analyst Weigh In

UGP has been the topic of several research reports. Bank of America upgraded shares of Ultrapar Participacoes from a "neutral" rating to a "buy" rating and upped their price objective for the company from $6.80 to $7.40 in a report on Wednesday, July 8th. Wall Street Zen upgraded Ultrapar Participacoes from a "buy" rating to a "strong-buy" rating in a report on Saturday, May 9th. UBS Group raised their price target on shares of Ultrapar Participacoes from $7.00 to $7.20 and gave the company a "buy" rating in a research report on Wednesday, June 17th. Weiss Ratings raised shares of Ultrapar Participacoes from a "hold (c+)" rating to a "buy (b-)" rating in a report on Friday, August 14th. Finally, The Goldman Sachs Group reduced their price objective on Ultrapar Participacoes from $6.50 to $5.80 and set a "neutral" rating for the company in a research note on Wednesday, August 26th. One research analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average price target of $6.40.

Ultrapar Participacoes Stock Performance

The company has a debt-to-equity ratio of 0.74, a quick ratio of 1.26 and a current ratio of 1.64. The company has a market capitalization of $7.42 billion, a P/E ratio of 10.90, a price-to-earnings-growth ratio of 0.39 and a beta of 0.70. The business has a 50 day moving average of $5.99 and a 200-day moving average of $5.60.

Ultrapar Participacoes (NYSE:UGP - Get Free Report) last issued its earnings results on Wednesday, August 12th. The oil and gas company reported $0.28 EPS for the quarter, topping the consensus estimate of $0.27 by $0.01. Ultrapar Participacoes had a return on equity of 18.84% and a net margin of 2.28%.The business had revenue of $8 billion during the quarter, compared to the consensus estimate of $8.18 billion. On average, sell-side analysts predict that Ultrapar Participacoes S.A. will post 0.78 EPS for the current fiscal year.

Ultrapar Participacoes Announces Dividend

The business also recently announced a dividend, which will be paid on Monday, September 14th. Investors of record on Wednesday, August 26th will be paid a $0.1932 dividend. This represents a yield of 599.0%. The ex-dividend date of this dividend is Wednesday, August 26th. Ultrapar Participacoes's dividend payout ratio (DPR) is currently 50.82%.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in UGP. Arrowstreet Capital Limited Partnership increased its stake in Ultrapar Participacoes by 235.7% in the 1st quarter. Arrowstreet Capital Limited Partnership now owns 927,216 shares of the oil and gas company's stock worth $5,109,000 after purchasing an additional 650,988 shares during the period. Renaissance Technologies LLC lifted its position in shares of Ultrapar Participacoes by 10.6% in the 1st quarter. Renaissance Technologies LLC now owns 3,740,700 shares of the oil and gas company's stock worth $20,611,000 after purchasing an additional 357,922 shares during the period. Banco BTG Pactual S.A. bought a new stake in Ultrapar Participacoes during the 4th quarter valued at approximately $2,631,000. Dimensional Fund Advisors LP boosted its position in shares of Ultrapar Participacoes by 42.7% during the first quarter. Dimensional Fund Advisors LP now owns 945,625 shares of the oil and gas company's stock valued at $5,210,000 after purchasing an additional 282,887 shares in the last quarter. Finally, Walleye Capital LLC grew its stake in Ultrapar Participacoes by 118.2% in the first quarter. Walleye Capital LLC now owns 182,723 shares of the oil and gas company's stock worth $1,007,000 after purchasing an additional 98,978 shares during the period. 3.58% of the stock is currently owned by hedge funds and other institutional investors.

Ultrapar Participacoes Company Profile

Ultrapar Participações SA is a Brazilian diversified holding company operating in the downstream energy and chemical sectors. Its Ipiranga unit runs one of Brazil's largest networks of fuel stations, supplying gasoline, ethanol, diesel and convenience-store products to retail and wholesale customers. Through Ultragaz, the company is a leading distributor of liquefied petroleum gas (LPG), offering cylinder and bulk gas solutions for residential, commercial and industrial use across urban and rural regions.

In the specialty chemicals arena, Ultrapar controls Oxiteno, which produces surfactants and specialty chemical formulations for industries such as personal care, oil and gas, agrochemicals and coatings.

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