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American Water (AWK) Unit to Invest in New Jersey Water Mains
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American Water Works (AWK - Free Report) recently announced that its unit, New Jersey American Water, will invest $3.7 million to rehabilitate segments of an aging 60-inch water transmission main in Piscataway. New Jersey American Water will employ a technique that involves lining 460 feet of the pipe with carbon fiber along a 2,800-foot section.
Proper maintenance and upgrade of the aging water mains are essential to ensure water quality and system pressures as well as increase system resiliency. The rehabilitation work on the pipeline will increase water pressure in pipelines to effectively serve customers' needs and help firefighters control emergency situations.
Aging Water Industry Needs Investment
A substantial portion of the United States water and wastewater infrastructure has aged and is nearing the end of effective service life. Aging results in pipeline breaks, ultimately leading to wastage of valuable potable water.
Per the findings of the American Society of Civil Engineers (“ASCE”), water main breaks occur every two minutes in the United States due to the aging of the existing water infrastructure. Per the ASCE finding, a delay in essential pipeline repairs and maintenance results in the loss of 2.1 trillion gallons of treated water every year in the United States.
Per the U.S. Environmental Protection Agency, the $473-billion investment is necessary to maintain and expand drinking water pipelines and $271 billion for wastewater pipelines to meet demand over the next 20 years. Frequent pipeline breaks result in the wastage of potable water and increase the risk of contamination. Hence, it is quite essential to make systematic investments in the repair and maintenance of the old infrastructure.
American Water plans to invest the $13-$14 billion range in the 2022-2026 period and within $28-$32 billion between 2022 and 2031 to upgrade as well as strengthen the existing water and wastewater infrastructure. Water utilities like California Water Service Group (CWT - Free Report) , Essential Utilities (WTRG - Free Report) and Middlesex Water (MSEX - Free Report) have well-chalked-out capital investment plans to strengthen their infrastructure.
California Water Service’s capital expenditure planned for 2022, 2023 and 2024 is $355 million, $360 million and $365 million, respectively. The current dividend yield of California Water Service is 1.76%.
Essential Utilities aims at investing $3 billion through 2024 to strengthen water and natural gas operations. The current dividend yield of Essential Utilities is 2.3%. WTRG pulled off an earnings surprise of 1.3% in the last four quarters, on average.
Middlesex Water plans to invest $229 million during the 2022-2024 period to strengthen its water and wastewater infrastructure to provide services to customers in a safe, reliable and efficient manner. The current dividend yield of Middlesex Water is 1.17%.
Price Performance
Shares of AWK have rallied 8.4% in the past year compared with the industry’s 8% growth.
Image Source: Zacks Investment Research
Zacks Rank
American Water currently has a Zacks Rank #4 (Sell).
Image: Bigstock
American Water (AWK) Unit to Invest in New Jersey Water Mains
American Water Works (AWK - Free Report) recently announced that its unit, New Jersey American Water, will invest $3.7 million to rehabilitate segments of an aging 60-inch water transmission main in Piscataway. New Jersey American Water will employ a technique that involves lining 460 feet of the pipe with carbon fiber along a 2,800-foot section.
Proper maintenance and upgrade of the aging water mains are essential to ensure water quality and system pressures as well as increase system resiliency. The rehabilitation work on the pipeline will increase water pressure in pipelines to effectively serve customers' needs and help firefighters control emergency situations.
Aging Water Industry Needs Investment
A substantial portion of the United States water and wastewater infrastructure has aged and is nearing the end of effective service life. Aging results in pipeline breaks, ultimately leading to wastage of valuable potable water.
Per the findings of the American Society of Civil Engineers (“ASCE”), water main breaks occur every two minutes in the United States due to the aging of the existing water infrastructure. Per the ASCE finding, a delay in essential pipeline repairs and maintenance results in the loss of 2.1 trillion gallons of treated water every year in the United States.
Per the U.S. Environmental Protection Agency, the $473-billion investment is necessary to maintain and expand drinking water pipelines and $271 billion for wastewater pipelines to meet demand over the next 20 years. Frequent pipeline breaks result in the wastage of potable water and increase the risk of contamination. Hence, it is quite essential to make systematic investments in the repair and maintenance of the old infrastructure.
American Water plans to invest the $13-$14 billion range in the 2022-2026 period and within $28-$32 billion between 2022 and 2031 to upgrade as well as strengthen the existing water and wastewater infrastructure. Water utilities like California Water Service Group (CWT - Free Report) , Essential Utilities (WTRG - Free Report) and Middlesex Water (MSEX - Free Report) have well-chalked-out capital investment plans to strengthen their infrastructure.
California Water Service’s capital expenditure planned for 2022, 2023 and 2024 is $355 million, $360 million and $365 million, respectively. The current dividend yield of California Water Service is 1.76%.
Essential Utilities aims at investing $3 billion through 2024 to strengthen water and natural gas operations. The current dividend yield of Essential Utilities is 2.3%. WTRG pulled off an earnings surprise of 1.3% in the last four quarters, on average.
Middlesex Water plans to invest $229 million during the 2022-2024 period to strengthen its water and wastewater infrastructure to provide services to customers in a safe, reliable and efficient manner. The current dividend yield of Middlesex Water is 1.17%.
Price Performance
Shares of AWK have rallied 8.4% in the past year compared with the industry’s 8% growth.
Image Source: Zacks Investment Research
Zacks Rank
American Water currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.