Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 stocks made the list for top value stocks in the Gas Utilities industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Gas Utilities Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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3 Undervalued Gas Utilities Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 3 undervalued stocks in the Gas Utilities industry for Tuesday, September 30, 2025. Let’s take a closer look at their individual scores to see how they measure up against each other and the Gas Utilities industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

RGC Resources, Inc.’s Value Grade

Value Grade:

RGC Resources, Inc., through its subsidiaries, operates as an energy services company. It sells and distributes natural gas to residential, commercial, and industrial customers in Roanoke, Virginia, and the surrounding localities. It operates approximately 1,180 miles of transmission and distribution pipeline; and a liquefied natural gas storage facility, as well as owns and operates eleven metering stations. The company also produces biogas. RGC Resources, Inc. was founded in 1883 and is based in Roanoke, Virginia.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

RGC Resources, Inc. has a Value Score of 61, which is considered to be undervalued.

When you look at RGC Resources, Inc.’s price-to-sales ratio at 2.43 compared to the industry median at 1.95, this company has a higher price relative to revenue compared to its peers. This could make RGC Resources, Inc.’s stock less attractive for value investors.

RGC Resources, Inc.’s price-earnings ratio is 16.80 compared to the industry median at 17.50. This means it has a lower share price relative to earnings compared to its peers. This could make RGC Resources, Inc. more attractive for value investors.

Now, let’s assess RGC Resources, Inc.’s EV/EBITDA ratio, also known as enterprise multiple. At 10.1, when compared to the industry median of 10.0, the company may be considered overvalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. RGC Resources, Inc.’s shareholder yield is the same than its industry median ratio of 2.40%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. RGC Resources, Inc.’s price-to-book ratio is higher than its industry median ratio of 1.53. This could make RGC Resources, Inc. less attractive to investors looking for a new addition to their portfolio.

Star Group, L.P.’s Value Grade

Value Grade:

Star Group, L.P., together with its subsidiaries, provides home heating oil and propane products and services to residential and commercial customers in the United States. It offers gasoline and diesel fuel; and installs, maintain, and repairs heating and air conditioning equipment. As of September 30, 2024, the company served approximately 404,600 full service residential and commercial home heating oil and propane customers and 61,700 customers on a delivery only basis. It sells gasoline and diesel fuel to approximately 26,800 customers. The company was formerly known as Star Gas Partners, L.P. and changed its name to Star Group, L.P. in October 2017. The company was incorporated in 1995 and is based in Stamford, Connecticut.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Star Group, L.P. has a Value Score of 99, which is considered to be undervalued.

Star Group, L.P.’s price-earnings ratio is 7.0 compared to the industry median at 17.5. This means that it has a lower price relative to its earnings compared to its peers. This makes Star Group, L.P. more attractive for value investors.

Star Group, L.P.’s price-to-book ratio is higher than its peers. This could make Star Group, L.P. less attractive for value investors when compared to the industry median at 1.53.

You can read more about Star Group, L.P.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Southwest Gas Holdings, Inc.’s Value Grade

Value Grade:

Southwest Gas Holdings, Inc., through its subsidiaries, purchases, distributes, and transports natural gas for residential, commercial, and industrial customers in Arizona, Nevada, and California. The company operates through two segments, Natural Gas Distribution and Utility Infrastructure Services. It offers tariff sales and transportation services. The company also provides installation, replacement, repair, and maintenance of energy distribution systems, as well as undertakes gas construction works in North America. Southwest Gas Holdings, Inc. was incorporated in 1931 and is headquartered in Las Vegas, Nevada.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Southwest Gas Holdings, Inc. has a Value Score of 62, which is considered to be undervalued.

Southwest Gas Holdings, Inc.’s price-earnings ratio is 29.0 compared to the industry median at 17.5. This means that it has a higher price relative to its earnings compared to its peers. This makes Southwest Gas Holdings, Inc. less attractive for value investors.

Southwest Gas Holdings, Inc.’s price-to-book ratio is lower than its peers. This could make Southwest Gas Holdings, Inc. fairly attractive for value investors when compared to the industry median at 1.53.

You can read more about Southwest Gas Holdings, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Gas Utilities Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Gas Utilities stocks as well as other industrys.

Choosing Which of the 3 Best Gas Utilities Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• RGC Resources, Inc. stock has a Value Grade of B.
• Star Group, L.P. stock has a Value Grade of A.
• Southwest Gas Holdings, Inc. stock has a Value Grade of B.

Now that you have a bit more background about each of the 3 undervalued stocks in the Gas Utilities industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Gas Utilities Stocks

Want to learn more about Gas Utilities stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 3 Undervalued Gas Utilities Stocks for Tuesday, September 30
• 3 Undervalued Gas Utilities Stocks for Monday, September 22
• 3 Undervalued Gas Utilities Stocks for Friday, September 19
• 3 Undervalued Gas Utilities Stocks for Thursday, September 18

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.