Value
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.7 |
| P/S | 9.1 |
| EV/EBITDA | 3.7 |
| Fwd P/E | 8.2 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 14.4x
- ▸PEG: 0.47
- ▸Attractively valued
SR · Why this verdict
Why Spire (SR) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Spire trades at a forward price-to-earnings of 14.2 times with a price-to-earnings growth ratio of 0.46, and analyst consensus implies approximately 25% upside from the current $78.74 price to targets near $85.74 — a meaningful gap for a regulated utility that should have predictable cash flows. Valuation breakdown | The stock closes at least 50% of the gap to analyst consensus price targets within 12 months, reaching $82 or higher, as rate case decisions and earnings growth validate the undervaluation thesis. | →Stable |
| CounterFree cash flow is severely negative at -258% of net income (a red flag in the quality model), meaning the company is not generating the cash that the earnings figure implies; regulated utilities often show negative free cash flow during heavy capital expenditure cycles, which limits true distributable value. | ||
A debt-to-equity ratio of 2.3 receives a -1.5 penalty in the bear case, and free cash flow is -258% of net income, both identifying financial risk factors that are severe relative to the utility sector average; value-trap signals are noted as 2 out of 5 criteria met. Bear case | Free cash flow deficit as a percentage of net income improves from -258% toward -100% or better within the next 18 months as a capital expenditure cycle moderates, demonstrating that the cash deficit is temporary rather than structural. | →Stable |
| CounterA regulated gas utility with D/E of 2.3 and -258% FCF/net-income is in a capital-heavy expansion or repair cycle that could persist for 3 to 5 years; if interest rates remain elevated, the cost of servicing this debt could prevent meaningful dividend growth. | ||
As a regulated gas utility serving Missouri and other Midwestern markets, Spire's revenues and allowed returns are set by public utility commissions, providing contractual earnings visibility; the Piotroski score of 7 out of 9 and earnings growth score of 8.2 both support the regulated earnings quality argument. Quality breakdown | Earnings per share grows at least 4% year-over-year in each of the next 2 annual reporting periods as rate increases approved by regulators flow through to revenues, consistent with the utility's typical regulatory cycle. | →Stable |
| CounterRegulatory risk is real: a rate case denial or unfavorable outcome could freeze revenue growth for 12 to 24 months, and Missouri's regulatory environment has been variable in historical outcomes for Spire's predecessor entities. | ||
RSI has reached 27, near capitulation territory, while on-balance volume is rising — a divergence where price is selling off but volume-weighted buying pressure is actually building — and the 200-day moving average is still trending upward at +1.9% per month, suggesting the pullback may be excessive relative to underlying conditions. Momentum breakdown | RSI recovers above 40 within 8 weeks and the stock holds above the $75.50 stop-loss level, with on-balance volume continuing to rise as the momentum divergence resolves in favor of price recovery. | →Stable |
| CounterRSI near 27 with the stock below its 200-day moving average despite a still-rising long-term average is consistent with a momentum-breaking event (like a failed rate case or earnings miss) that could validate the selling and push the stock further below technical support. | ||
Spire trades at a forward price-to-earnings of 14.2 times with a price-to-earnings growth ratio of 0.46, and analyst consensus implies approximately 25% upside from the current $78.74 price to targets near $85.74 — a meaningful gap for a regulated utility that should have predictable cash flows.
→StableValuation breakdown
- Expectation
- The stock closes at least 50% of the gap to analyst consensus price targets within 12 months, reaching $82 or higher, as rate case decisions and earnings growth validate the undervaluation thesis.
CounterFree cash flow is severely negative at -258% of net income (a red flag in the quality model), meaning the company is not generating the cash that the earnings figure implies; regulated utilities often show negative free cash flow during heavy capital expenditure cycles, which limits true distributable value.
A debt-to-equity ratio of 2.3 receives a -1.5 penalty in the bear case, and free cash flow is -258% of net income, both identifying financial risk factors that are severe relative to the utility sector average; value-trap signals are noted as 2 out of 5 criteria met.
→StableBear case
- Expectation
- Free cash flow deficit as a percentage of net income improves from -258% toward -100% or better within the next 18 months as a capital expenditure cycle moderates, demonstrating that the cash deficit is temporary rather than structural.
CounterA regulated gas utility with D/E of 2.3 and -258% FCF/net-income is in a capital-heavy expansion or repair cycle that could persist for 3 to 5 years; if interest rates remain elevated, the cost of servicing this debt could prevent meaningful dividend growth.
As a regulated gas utility serving Missouri and other Midwestern markets, Spire's revenues and allowed returns are set by public utility commissions, providing contractual earnings visibility; the Piotroski score of 7 out of 9 and earnings growth score of 8.2 both support the regulated earnings quality argument.
→StableQuality breakdown
- Expectation
- Earnings per share grows at least 4% year-over-year in each of the next 2 annual reporting periods as rate increases approved by regulators flow through to revenues, consistent with the utility's typical regulatory cycle.
CounterRegulatory risk is real: a rate case denial or unfavorable outcome could freeze revenue growth for 12 to 24 months, and Missouri's regulatory environment has been variable in historical outcomes for Spire's predecessor entities.
RSI has reached 27, near capitulation territory, while on-balance volume is rising — a divergence where price is selling off but volume-weighted buying pressure is actually building — and the 200-day moving average is still trending upward at +1.9% per month, suggesting the pullback may be excessive relative to underlying conditions.
→StableMomentum breakdown
- Expectation
- RSI recovers above 40 within 8 weeks and the stock holds above the $75.50 stop-loss level, with on-balance volume continuing to rise as the momentum divergence resolves in favor of price recovery.
CounterRSI near 27 with the stock below its 200-day moving average despite a still-rising long-term average is consistent with a momentum-breaking event (like a failed rate case or earnings miss) that could validate the selling and push the stock further below technical support.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Spire Inc. is a regulated gas utility with attractive valuation at a forward price-to-earnings of 14.2 times and a price-to-earnings growth ratio of 0.46, with analysts seeing roughly 25% upside to consensus targets, but its free cash flow is deeply negative at -258% of net income and high leverage of 2.3 times debt-to-equity limits the margin of safety.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.0 |
| ROA | 1.9 |
| Gross margin | 4.6 |
| Op margin | 10.0 |
| Net margin | 6.9 |
| Current ratio | 2.2 |
| FCF quality | 0.0 |
| Moat | 4.5 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: -258% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
5.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.6 |
| EPS growth | 8.2 |
Momentum
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 5.2 |
| Volume | 2.7 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+1.3%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.0 |
| Price target | 7.7 |
| erm sentiment | 4.3 |
- ▸Light analyst coverage (10.0) — signal dampened
- ▸Analyst upside: 20%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Negligible insider selling — $56,609 (0.001% of mkt cap)
Peer rank
6.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 6.7 |
| quality rank | 5.7 |
| growth rank | 7.1 |
Technical
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.5 |
| support resistance | 4.2 |
| 52w position | 6.9 |
Risk (lower is worse)
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.6 |
| days to cover | 6.5 |
| volatility | 6.9 |
| put call | 10.0 |
| implied vol | 4.9 |
| beta | 9.7 |
| debt equity | 2.7 |
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.2 |
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:4.7>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:31d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:1.0<1.5@spot
Warning (1)
- MOMENTUM:4.7<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
0.96
Upside
+4.8%
Downside
5.0%
Sizing output
AVOID
SetupRange Bound — RSI 56 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $4.7B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.4) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:1.0<1.5@spot) reinforce the read. Current asymmetry R:R is 0.96 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.4, Risk (lower is worse) at 6.9, and Sentiment at 6.5; the weakest are Quality at 4.5, Momentum at 4.7, and Technical at 4.9. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 0.96 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Value Analyst Upside
Trip ifAnalyst consensus price target falls below $72.00, more than 8% below the current price, indicating broad downward revisions that eliminate the upside thesis.
- P2High Leverage Negative Fcf Risk
Trip ifDebt-to-equity ratio rises above 3.0, more than 30% above the current 2.3, indicating leverage is increasing further rather than stabilizing.
- P3Regulated Utility Earnings Stability
Trip ifA regulatory rate case decision results in an allowed return below 8.5%, less than typical Midwestern utility benchmarks, indicating the regulatory environment has turned unfavorable.
- P4Oversold Momentum With Rising Volume
Trip ifPrice drops below $73.00, more than 7% below the current $78.74, indicating the RSI capitulation did not produce a reversal and the stock has continued falling through support.