Zacks_Analysts' Blog : Ferrellgas Boosts Propane Portfolio - Analyst Blog

Ferrellgas Partners L.P. (FGP) has added another propane retailer, Economy Propane Inc., consistent with its strategy of acquiring new assets that complement its portfolio. The acquisition of this Lakeport, California-based retailer marks the partnership’s first acquisition this fiscal year, which began on August 1, 2011, and the fourth in this calendar year.

Economy Propane, as an independent propane retailer, meets all the requisites of Ferrellgas' growth-through-acquisition strategy, where the partnership aims to gain control of good businesses in lucrative markets. Going forward, the Ferrellgas family will join Economy employees in the hope of proving superior service to its new customers.

Through its growth-by-acquisition strategy Ferrellgas has made as many as 225 acquisitions in over 70 years to transform itself from a single-location, independently owned propane retailer to one of the largest propane retailers in the United States.

Ferrellgas is scheduled to release its fourth quarter 2011 earnings results on September 26, 2011. Currently, the Zacks Consensus Estimates for the fourth quarter, fiscal 2011 and fiscal 2012 are a loss of 41 cents, a loss of 48 cents and a profit of 79 cents per unit, respectively.

Overland Park, Kansas-based Ferrellgas Partners L.P. is a leading distributor of propane and equipment in the U.S. The partnership provides propane services to Residential, Industrial, Portable Tank Exchange, Agricultural and Wholesale customers. The major competitors of the partnership are AmeriGas Partners L.P. (APU), Energy Transfer Partners L.P. (ETP) and Suburban Propane Partners L.P. (SPH).

Ferrellgas Partners retains a Zacks #3 Rank (short-term ‘Hold’ rating), which supports our long-term “Neutral” rating on the stock.