Transportadora de Gas del Sur

TGS

Market cap $3.35B

Transportadora de Gas del Sur benefits from monthly inflation-linked tariff updates, restoring predictability and making gas transportation the core driver of revenue and profitability. Liquids segment still reflects March storm disruption, but operations normalized in May; Midstream in Vaca Muerta continues expanding with double-digit growth and dollar-denominated contracts. Despite margins above 40% and a net cash position, Transportadora de Gas del Sur trades at only 6x EV/EBITDA and 8x EV/EBIT, showing a valuation gap.

Transportadora De Gas Ord B (TGS) witnessed a jump in share price last session on above-average trading volume. The latest trend in earnings estimate revisions for the stock doesn't suggest further strength down the road.

Conservative capital spending by upstream players and gradual shifting to renewables may hurt the demand for midstream players' assets. Enbridge (ENB), Kinder Morgan (KMI), The Williams Companies (WMB) and MPLX are surviving the industry challenges.

Transportadora de Gas del Sur is a leading Argentine energy company focused on natural gas production and commercialization. TSG operates through four main business segments, with its core strength in natural gas transportation and processing. The company's strategic position in Argentina's energy infrastructure underpins its long-term growth potential and resilience.

Tariff normalization underway: Monthly inflation-linked updates since May 2025 restore predictability and unlock value in TGS's regulated transport business. Strong operating momentum: Transport revenues up 366% YoY in Q1 2025, with margins expanding and cash flow doubling. Strategic positioning: TGS controls Argentina's core gas infrastructure and is poised to benefit from Vaca Muerta and regional gas exports.

Does Transportadora De Gas Sa Ord B (TGS) have what it takes to be a top stock pick for momentum investors? Let's find out.

BUENOS AIRES, Argentina, April 24, 2025 /PRNewswire/ -- Transportadora de Gas del Sur S.A. ("tgs" or "the Company") (NYSE: TGS, MERVAL: TGSU2) announced that today it filed its annual report on Form 20-F for the fiscal year ended December 31, 2024 (the "2024 Annual Report") with the U.S. Securities and Exchange Commission (the "SEC").

PHIO and TGS made it to the Zacks Rank #1 (Strong Buy) value stocks list on April 23, 2025.

Transportadora De Gas Ord B (TGS) was a big mover last session on higher-than-average trading volume. The latest trend in earnings estimate revisions might not help the stock continue moving higher in the near term.

Transportadora de Gas del Sur's transportation segment saw a massive profitability boost due to a 700% tariff increase, but inflation adjustments lag, risking future profitability. The liquids segment faced a 50% YoY operating income drop due to maintenance and unfavorable FX rates, while midstream revenues grew 17% in USD terms. TGS's valuation remains high even under optimistic assumptions, with significant political, economic, and currency risks impacting future performance.