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American States Water (AWR) Beats Q3 Earnings Estimates

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American States Water Company (AWR - Free Report) reported third-quarter 2016 pro forma earnings of 59 cents per share, surpassing the Zacks Consensus Estimate of 57 cents by 3.5%. Reported earnings also improved 5.4% from the year-ago figure of 56 cents.

The year-over-year increase was due to higher contribution from the Water and Electric segments.

Revenues

American States Water’s operating revenues in the quarter were $123.8 million, which lagged the Zacks Consensus Estimate of $136 million by 8.9%. Revenues also decreased 6.8% year over year.

Operational Update

In the quarter under review, American States Water’s total operating expenses were $84.2 million, down 8.3% year over year. Interest expenses were $5.7 million, up 4.5%.

AMER STATES WTR Price, Consensus and EPS Surprise

 

Segment Details

The Water segment’s earnings during the quarter came in at 47 cents, up 9.3% year over year. The upside was driven by an increase in water margin due to higher revenues from customers, new revenuesgenerated from a water system acquired in Oct 2015, an increase in interest and other income backed by higher gains on investments held for a retirement benefit plan, and a decline in the effective income tax rate.

The Electric segment’s earnings during the quarter amounted to 2 cents, up 1% year over year.

The Contracted Services segment’s earnings tanked 16.7% year over year to 10 cents.

Financial Update

As of Sep 30, 2016, American States Water’s cash and cash equivalents were $2.8 million, compared with $4.3 million as of Dec 31, 2015.

As of Sep 30, 2016, long-term debts were $320.9 million, flat with the year-ago levels.

Net cash from operating activities in the first nine months of the year was $77.5 million, down from $86.1 million in the year-ago period.

Peer Releases

Aqua America Inc.’s third-quarter earnings of 41 cents per share outpaced the Zacks Consensus Estimate of 39 cents by 5.1%.

SJW Corp. (SJW - Free Report) reported third-quarter 2016 adjusted earnings of 92 cents per share, surpassing the Zacks Consensus Estimate of 45 cents by 104.4%.

California Water Service Group (CWT - Free Report) reported third-quarter earnings per share of 48 cents per share, missing the Zacks Consensus Estimate of 57 cents by 15.8%.

Zacks Rank

American States Water Companycarries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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