Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Written in the first person by Warren Buffett and Charlie Munger, from the fiscal Q3 2026 Form 10-Q (quarter ended June 30, 2026), the August 5, 2026 earnings release, and current market data. Atmos is a well-run legal monopoly — the largest pure-play natural gas distributor in America, concentrated in the friendliest regulatory state in the union. Management is honest, conservative, and executes with a consistency we genuinely admire. And yet we arrive at two stars, because the economics of the business are those of a regulated utility: returns on equity capped near 9.5–10%, enormous and perpetual capital consumption, negative free cash flow as far as the eye can see, and growth funded by issuing roughly 5% more stock every year.
Recent filings analysed: 8-K (2026-08-10), 10-Q (2026-08-05), 8-K (2026-08-05), 8-K (2026-06-18).
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