Value
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.1 |
| P/S | 8.8 |
| EV/EBITDA | 4.7 |
| Fwd P/E | 8.1 |
| PEG | 4.3 |
| Analyst target | 5.0 |
- ▸Forward P/E: 14.8x
- ▸PEG: 2.22
NJR · Why this verdict
Why NewJersey Resources (NJR) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.8/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
New Jersey Resources offers a regulated gas utility with a reliable earnings track record and strong Piotroski financial health, but limited upside at current prices makes the risk-reward unfavorable for new buyers.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
New Jersey Resources has beaten earnings estimates in 3 of the last 4 quarters, with an average surprise of over 72%, suggesting management consistently delivers above expectations in its regulated utility segment. Earnings | Earnings beats continue in at least 2 of the next 3 reported quarters, sustaining a positive surprise track record. | →Stable |
| CounterThe regulated utility model limits earnings variability, so beats may reflect conservative guidance-setting rather than genuine operational outperformance. | ||
A Piotroski F-Score of 7 out of 9 signals solid financial health across profitability, leverage, and operating efficiency metrics for this regulated gas utility. Quality breakdown | The Piotroski F-Score remains at 7 or above over the next 12 months, reflecting sustained operational health. | →Stable |
| CounterFree cash flow is deeply negative at roughly negative 90% relative to net income, which undermines the quality signal from the Piotroski score. | ||
A debt-to-equity ratio of 1.4 combined with a current analyst price target already above the current price leaves limited room for new buyers to profit without an upside revision. Bear case | Analyst price targets rise at least 8% above current price over the next 12 months to restore a meaningful upside margin. | ↓Deteriorating |
| CounterRegulated utilities routinely carry higher leverage because their revenue streams are contractually guaranteed, so the debt load may not be as risky as it appears. | ||
With the current price already at or above the analyst consensus target, the reward-to-risk ratio is negative, meaning downside risk of roughly 5% outweighs the estimated upside of negative 4%. Targets | A meaningful pullback brings the price at least 7% below analyst target, restoring a favorable entry point. | ↑Improving |
| CounterMomentum indicators show the stock trading above its 200-day moving average, and RSI at 38 suggests a possible short-term bounce rather than further weakness. | ||
New Jersey Resources has beaten earnings estimates in 3 of the last 4 quarters, with an average surprise of over 72%, suggesting management consistently delivers above expectations in its regulated utility segment.
→StableEarnings
- Expectation
- Earnings beats continue in at least 2 of the next 3 reported quarters, sustaining a positive surprise track record.
CounterThe regulated utility model limits earnings variability, so beats may reflect conservative guidance-setting rather than genuine operational outperformance.
A Piotroski F-Score of 7 out of 9 signals solid financial health across profitability, leverage, and operating efficiency metrics for this regulated gas utility.
→StableQuality breakdown
- Expectation
- The Piotroski F-Score remains at 7 or above over the next 12 months, reflecting sustained operational health.
CounterFree cash flow is deeply negative at roughly negative 90% relative to net income, which undermines the quality signal from the Piotroski score.
A debt-to-equity ratio of 1.4 combined with a current analyst price target already above the current price leaves limited room for new buyers to profit without an upside revision.
↓DeterioratingBear case
- Expectation
- Analyst price targets rise at least 8% above current price over the next 12 months to restore a meaningful upside margin.
CounterRegulated utilities routinely carry higher leverage because their revenue streams are contractually guaranteed, so the debt load may not be as risky as it appears.
With the current price already at or above the analyst consensus target, the reward-to-risk ratio is negative, meaning downside risk of roughly 5% outweighs the estimated upside of negative 4%.
↑ImprovingTargets
- Expectation
- A meaningful pullback brings the price at least 7% below analyst target, restoring a favorable entry point.
CounterMomentum indicators show the stock trading above its 200-day moving average, and RSI at 38 suggests a possible short-term bounce rather than further weakness.
Per-dimension breakdown
Quality
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.8 |
| ROA | 3.0 |
| Gross margin | 3.8 |
| Op margin | 3.7 |
| Net margin | 8.2 |
| Current ratio | 2.6 |
| FCF quality | 0.0 |
| Moat | 6.1 |
| Piotroski F | 6.7 |
- ▸Strong margins: 16%
- ▸Earnings quality RED FLAG: -71% FCF/NI
Growth
6.7/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 6.7 |
Momentum
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 1.7 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 10.0 |
| vol acceleration | 5.5 |
- ▸Capitulation risk (RSI 23, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+2.5%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.7 |
| Price target | 7.5 |
| erm sentiment | 4.1 |
- ▸Light analyst coverage (7.0) — signal dampened
Insider
5.6/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 6.2 |
- ▸Negligible insider selling — $166,894 (0.003% of mkt cap)
Peer rank
6.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.6 |
| quality rank | 7.5 |
| growth rank | 7.9 |
Technical
8.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 10.0 |
| support resistance | 9.0 |
| 52w position | 6.8 |
Risk (lower is worse)
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.3 |
| days to cover | 2.9 |
| volatility | 7.6 |
| implied vol | 5.9 |
| beta | 9.9 |
| debt equity | 4.1 |
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 6.0 |
- ▸Strong earnings: 3B/1M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Mixed signals. Hold existing position.
Engine technical detail
verdict_path:
L4:PATH_F_HOLD_DEFAULTPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:52d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:3.9<4.5
- ASYMMETRY:0.6<1.5@spot
Warning (0)
none
Reward-to-Risk
0.58
Upside
+2.9%
Downside
5.0%
Sizing output
AVOID
SetupOversold Bounce — Oversold RSI 23, near Bollinger lower, volume surge
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The default F-path HOLD fired without any positive-conviction gate triggering — no momentum acceleration, no quality+value crossover, no setup recognition. Highest-clear gate: INSIDER:OK. Top dim: Technical at 8.6; weakest: Momentum at 3.9. The engine's read is one of pattern absence — no directional conviction in either direction at current asymmetry.
The strongest dimensions are Technical at 8.6, Growth at 6.7, and Value at 6.4; the weakest are Momentum at 3.9, Quality at 4.3, and Insider at 5.6. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 0.58 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Reliability
Trip ifEarnings surprise falls below 0% in at least 2 of the next 3 quarters.
- P2Financial Health Piotroski
Trip ifFree cash flow relative to net income falls below negative 120% for 2 consecutive quarters.
- P3Leverage Constrains Upside
Trip ifAnalyst consensus price target rises above $59 within 12 months.
- P4Negative Risk Reward Asymmetry
Trip ifPrice drops below $50 without a corresponding drop in the analyst target below $52.