U.S. Markets closed
  • S&P 500

    4,701.21
    +14.46 (+0.31%)
     
  • Dow 30

    35,754.75
    +35.32 (+0.10%)
     
  • Nasdaq

    15,786.99
    +100.07 (+0.64%)
     
  • Russell 2000

    2,271.71
    +17.92 (+0.80%)
     
  • Crude Oil

    72.62
    +0.26 (+0.36%)
     
  • Gold

    1,784.30
    -1.20 (-0.07%)
     
  • Silver

    22.45
    +0.02 (+0.10%)
     
  • EUR/USD

    1.1347
    +0.0074 (+0.6581%)
     
  • 10-Yr Bond

    1.5090
    +0.0290 (+1.96%)
     
  • Vix

    19.90
    -1.99 (-9.09%)
     
  • GBP/USD

    1.3208
    -0.0034 (-0.2589%)
     
  • USD/JPY

    113.7190
    +0.1790 (+0.1577%)
     
  • BTC-USD

    50,399.50
    +5.80 (+0.01%)
     
  • CMC Crypto 200

    1,320.56
    +15.44 (+1.18%)
     
  • FTSE 100

    7,337.05
    -2.85 (-0.04%)
     
  • Nikkei 225

    28,860.62
    +405.02 (+1.42%)
     

Chesapeake Utilities' (CPK) Elkton Gas Acquisition in Process

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Chesapeake Utilities Corporation CPK recently announced that it will acquire South Jersey Industries’ SJI subsidiary — Elkton Gas — which operates within a franchised area of Cecil County, Maryland.

If approved by the Maryland Public Service Commission, the acquisition will be completed in the first half of 2020. Post completion, Elkton Gas will become a wholly-owned subsidiary of Chesapeake Utilities. However, the unit will continue to operate in its existing office with the same personnel.

Footprint Expansion

The company provides natural gas service in another franchised area of Cecil County. The acquisition will enable Chesapeake Utilities to further expand its footprint in the region. The buyout is in sync with the company’s growth strategy that will generate earnings in the future.

The company is also undertaking initiatives to expand its natural gas projects. Few projects have been completed and some are likely to be completed in the next few years. Together, all these projects are expected to increase annual margin of $34.3 million in 2020.

Long-Term Growth Strategy

Apart from acquisitions for expansions, the company is also investing in organic projects. In 2019, the company expects to spend in the range of $170-$185 million. In its five year CapEx plan, Black Hills plans to invest between $750 million to $1 billion on utility & pipeline businesses.

Other companies from the same sector are also investing on a long-term basis. Sempra Energy SRE expects to make investments of approximately $18.2 billion during the 2019-2023 period. NextEra Energy NEE has plans to invest nearly $36.6 billion in different projects from 2019 through 2023.

Moreover, in the third quarter of 2019, the company exited from the natural gas marketing business as it was not aligned with its long-term growth strategy.

Price Movement

Chesapeake Utilities’ shares have gained 3.3% in the past 12 months compared with the industry’s rise of 9.6%.



Zacks Rank

Chesapeake Utilities currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
 
Sempra Energy (SRE) : Free Stock Analysis Report
 
South Jersey Industries, Inc. (SJI) : Free Stock Analysis Report
 
Chesapeake Utilities Corporation (CPK) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research