Unitil (UTL) in focus as FPA Queens Road points to rate-base acquisitions and 5%-7% EPS path
Acquisitions of Bangor Gas, Maine Natural Gas, and two water utilities in New Hampshire and Maine, collectively priced at roughly 1.25 times rate base, sit at the center of FPA Queens Road Small Cap Value Fund's case for Unitil (NYSE: UTL), which the fund highlighted in its second-quarter 2026 investor letter. The company believes it can grow earnings per share at a 5% to 7% annual rate, in line with its history, and shares closed at approximately $53.10 on August 28, 2026, within a 52-week range of $44.61 to $57.26, giving Unitil a market capitalization of roughly $976.39 million.
Key takeaways
- FPA Queens Road Small Cap Value Fund highlighted Unitil (NYSE: UTL) in its second-quarter 2026 investor letter, pointing to acquisitions and a 5%-7% EPS growth path.
- Unitil acquired Bangor Gas, Maine Natural Gas, and two water utilities in New Hampshire and Maine, collectively priced at roughly 1.25 times rate base.
- Unitil shares closed at approximately $53.10 on August 28, 2026, within a 52-week range of $44.61 to $57.26, for a market capitalization of about $976.39 million.
- The fund's main reservation about Unitil is the company's small size and limited liquidity.
- The fund said the clearest test to watch is the next rate case outcome in Unitil's New England service territories to see if the acquired rate base converts into 5%-7% annual EPS growth.
Acquisitions of Bangor Gas, Maine Natural Gas, and two water utilities in New Hampshire and Maine, collectively priced at roughly 1.25 times rate base, sit at the center of FPA Queens Road Small Cap Value Fund's case for Unitil (NYSE: UTL), which the fund highlighted in its second-quarter 2026 investor letter. The company believes it can grow earnings per share at a 5% to 7% annual rate, in line with its history, and shares closed at approximately $53.10 on August 28, 2026, within a 52-week range of $44.61 to $57.26, giving Unitil a market capitalization of roughly $976.39 million.
The regulated-asset build
Unitil distributes electricity and natural gas to customers across Maine, New Hampshire, and Northern Massachusetts. The fund described those as attractive regulatory jurisdictions and noted the company does "a good job converting investments in their rate base into GAAP earnings." Those acquisitions, priced collectively at roughly 1.25 times rate base, expand the company's regulated footprint into New England's natural gas and water segments. FPA Queens Road characterized Unitil overall as "well run and diversified."
Ownership and what to watch
FPA Queens Road returned 27.02% in the first half of 2026, outpacing the Russell 2000 Value Index's 22.99% gain and the S&P 600 Index's 23.90% return. Small-cap earnings growth began accelerating relative to large caps during the period, the fund noted. The fund maintained a bottom-up approach and ended the second quarter with 10.2% in cash after eliminating about $62 million in capital gains during Q2 and approximately $140 million year-to-date through July.
The fund's one stated reservation concerns market structure. "Our enthusiasm for the shares is only tempered by the company's small size and limited liquidity," the letter said. Shares posted a one-month return of -0.13%. Hedge fund ownership has also thinned: nine portfolios held UTL at the end of the first quarter of 2026, down from 14 the prior quarter. What to watch is the next rate case outcome in any of Unitil's New England service territories, which would be the clearest test of whether the acquired rate base converts into the 5% to 7% annual EPS trajectory the company expects to sustain.
Related reading
Filed by the newsroom of MarketPR on September 1, 2026. Source: finance.yahoo.com. Indicative figures are not investment advice.