Filing Flows › Companies › Southwest Gas Holdings › Analysis traps
Southwest Gas Holdings (SWX): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q1 2026, to Mar 31, 2026, filed May 5, 2026; rules v1.1
Southwest Gas Holdings (SWX): 0 rules of 10 triggered on the filings to Mar 31, 2026. 1 to review; 3 with insufficient data; 2 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Low P/E at a cyclical peak = undervalued To review · confidence medium
Net income of $547M is at a high against a median of $147M over eight years; at 12.3× the market is not pricing it as cheap, but a multiple on this year's profit still understates the mid-cycle one (45.6×).
Every rule
A01 FCF growth = the business improved Not triggered confidence high
Free cash flow did not rise ($509M → −$252M): the trap does not arise.
The figures and how they are read
| Fiscal year before | FY2024 |
| Fiscal year | FY2025 |
| Operating cash flow, year before | $1.4B |
| Operating cash flow | $556M |
| Capex, year before | $847M |
| Capex | $808M |
| Free cash flow, year before | $509M |
| Free cash flow | −$252M |
| Change in FCF | −$761M |
| Change in capex | −$39M |
| Working capital: change in its cash contribution | −$19M |
FCF = operating cash flow − cash capex; ΔFCF = ΔOCF − ΔCapEx; the working-capital part is the change in the cash-bridge items (receivables, inventory, payables, accruals), with the sign of the cash flow statement
Source: FY2025 (cash flow statement, fiscal year) · FY2024 (cash flow statement, fiscal year before)
A07 Stock compensation added back = no economic cost Not triggered confidence high
Stock compensation is 0.8% of revenue: small enough that adding it back changes little.
The figures and how they are read
| Fiscal year | FY2025 |
| Stock compensation | $15M |
| Revenue | $1.9B |
| SBC / revenue | +0.8% |
| Buybacks | 0 |
| Buybacks / SBC | 0.0 |
| Diluted shares, year before | 72.0M shares |
| Diluted shares | 72.3M shares |
| Diluted shares: change | +0.4% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY2025 (stock compensation, buybacks and the diluted share count, fiscal year)
B02 Receivables growing = future cash is certain Not triggered confidence medium
Receivables grew -76% against revenue -22% in Q1 2026; DSO 26 against a median of 73: collections are keeping pace with sales.
The figures and how they are read
| Quarter | Q1 2026 |
| Revenue, year over year | -21.6% |
| Receivables, year over year | -75.7% |
| Quarter before | Q4 2025 |
| Revenue y/y, quarter before | -13.1% |
| Receivables y/y, quarter before | -16.0% |
| Days sales outstanding | 26.1 |
| DSO, median of eight quarters | 72.9 |
| Receivables | $169M |
| Revenue | $585M |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q1 2026 (receivables and revenue) · Q1 2025 (the same quarter a year earlier)
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Insufficient data
no balance-sheet cash or debt on file
D03 EPS growth = profit growth Not triggered confidence high
EPS rose 21% and net income rose 22% in Q1 2026; the share count rose 0.6%: EPS growth follows profit growth.
The figures and how they are read
| Quarter | Q1 2026 |
| Quarter before | Q1 2025 |
| EPS, year before | $1.58 |
| EPS | $1.91 |
| Net income, year before | $114M |
| Net income | $138M |
| Diluted shares, year before | 72.1M shares |
| Diluted shares | 72.6M shares |
| EPS growth | +20.8% |
| Net income growth | +21.5% |
| Diluted shares: change | +0.6% |
| eps from profit | $0.34 |
| eps from share count | -$0.01 |
EPS and net income against the same quarter a year earlier; the EPS bridge attributes the change to profit first, then to the share count (the order is fixed and disclosed)
Source: Q1 2026 (net income, diluted shares, EPS) · Q1 2025 (the same quarter a year earlier)
E02 Low P/E at a cyclical peak = undervalued To review confidence medium
Net income of $547M is at a high against a median of $147M over eight years; at 12.3× the market is not pricing it as cheap, but a multiple on this year's profit still understates the mid-cycle one (45.6×).
The figures and how they are read
| market value | $6.7B |
| net income ttm | $547M |
| pe ttm | 12.30 |
| net income median fy | $147M |
| pe mid cycle | 45.60 |
| net income peak fy | $440M |
| years | FY2022 / 147.0; FY2022 / -203.0; FY2023 / -254.0; FY2023 / -218.0; FY2023 / -203.0; FY2023 / 151.0; FY2024 / 199.0; FY2025 / 440.0 |
| down years in window | 2 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q1 2026 (net income, trailing twelve months)
What would show the trap does not apply
- Profit holds at this level through the next two years (the eight-year peak was a new base, not a top)
- The industry's capacity and prices stay where they are rather than reverting
Look again: next filing.
E07 A precise DCF value = the true value Insufficient data
no DCF in the valuation research for this company
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Southwest Gas Holdings: cash flow →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.