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California Water (CWT) Arm Buys Morningstar Water System
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California Water Service Group (CWT - Free Report) announced that its unit, New Mexico Water Service, successfully closed the acquisition of Animas Valley Land and Water, LLC’s (AV Water) Morningstar Water System. The acquisition was reviewed and approved by the New Mexico Public Regulation Commission and the San Juan County district court. The completion of the acquisition will allow New Mexico Water Service to deliver high-quality water services to Morningstar customers.
The acquisition of Morningstar Water System will add 2,000 customers to New Mexico Water Service’s customer base.
Strengthening Operations via Acquisitions & Investments
California Water Service’s customer base increased year over year by 0.8% in 2021. CWT is making steady efforts to expand operations either organically or inorganically and its customer base is likely to continue witnessing this uptrend in 2022.
In March 2022, New Mexico Water Service signed an agreement to acquire the assets of Monterey Water Company, which added 380 residential customers to its customer base and is expected to add nearly 100 undeveloped lots to be served in the future. In addition to the new Monterey Water customers, New Mexico Water currently serves about 16,000 people through 8,500 water and wastewater service connections in the service territory. Also, in April 2022, the utility’s other unit, Washington Water Service, signed an agreement to acquire the water assets of Stroh’s Water Company, which will add 900 customers to its customer base. In 2021, California Water Service’s units completed four acquisitions, which added 585 water connections and 3000 wastewater connections.
The aging of the water and wastewater pipelines is currently a big concern for the industry and requires consistent investments to maintain and upgrade infrastructure. California Water Service invested $293.2 million in 2021 and expects to invest $1,080 million in the 2022-2024 period for upgrading infrastructure.
Some stocks in the water industry that are expanding operations through acquisitions are American Water Works (AWK - Free Report) , Essential Utilities (WTRG - Free Report) and Consolidated Water (CWCO - Free Report) .
American Water Works continues to widen its market footprint through strategic acquisitions. In 2021, the company expanded its customer base by 20,000 through 23 closed acquisitions in six states.
American Water Works’ long-term (three to five years) earnings growth is currently pegged at 8.1%. The Zacks Consensus Estimate for AWK’s 2022 earnings implies year-over-year growth of 4.7%.
In 2021, Essential Utilities closed two acquisitions, which added 7,700 new customers. During the six years ended Dec 31, 2021, Essential Utilities expanded utility operations by completing many water and wastewater acquisitions, which, in turn, added 94,000 new customers.
Essential Utilities’ long-term earnings growth is currently pegged at 6.1%. The Zacks Consensus Estimate for WTRG’s 2022 earnings implies year-over-year growth of 6.6%.
Consolidated Water acquired 100% interest in Aerex Industries, Inc., a U.S. original equipment manufacturer and service provider of a wide range of products and services for industrial water treatment. Consolidated Water also acquired 51% of PERC Water Corporation, a water infrastructure provider, which expanded CWCO’s product offerings and presence in the United States. These acquired units continue to boost the company’s performance and expand the customer base.
Consolidated Water’s long-term earnings growth is currently pegged at 8%. The Zacks Consensus Estimate for Consolidated Water’s 2022 earnings implies year-over-year growth of 130.4%.
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California Water (CWT) Arm Buys Morningstar Water System
California Water Service Group (CWT - Free Report) announced that its unit, New Mexico Water Service, successfully closed the acquisition of Animas Valley Land and Water, LLC’s (AV Water) Morningstar Water System. The acquisition was reviewed and approved by the New Mexico Public Regulation Commission and the San Juan County district court. The completion of the acquisition will allow New Mexico Water Service to deliver high-quality water services to Morningstar customers.
The acquisition of Morningstar Water System will add 2,000 customers to New Mexico Water Service’s customer base.
Strengthening Operations via Acquisitions & Investments
California Water Service’s customer base increased year over year by 0.8% in 2021. CWT is making steady efforts to expand operations either organically or inorganically and its customer base is likely to continue witnessing this uptrend in 2022.
In March 2022, New Mexico Water Service signed an agreement to acquire the assets of Monterey Water Company, which added 380 residential customers to its customer base and is expected to add nearly 100 undeveloped lots to be served in the future. In addition to the new Monterey Water customers, New Mexico Water currently serves about 16,000 people through 8,500 water and wastewater service connections in the service territory. Also, in April 2022, the utility’s other unit, Washington Water Service, signed an agreement to acquire the water assets of Stroh’s Water Company, which will add 900 customers to its customer base. In 2021, California Water Service’s units completed four acquisitions, which added 585 water connections and 3000 wastewater connections.
The aging of the water and wastewater pipelines is currently a big concern for the industry and requires consistent investments to maintain and upgrade infrastructure. California Water Service invested $293.2 million in 2021 and expects to invest $1,080 million in the 2022-2024 period for upgrading infrastructure.
Zacks Rank & Price Performance
California Water Service presently has a Zacks Rank #3 (Hold). In the past six months, shares of CWT have declined 6.5% against the industry’s rise of 2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Acquisitions by Water Utilities
Some stocks in the water industry that are expanding operations through acquisitions are American Water Works (AWK - Free Report) , Essential Utilities (WTRG - Free Report) and Consolidated Water (CWCO - Free Report) .
American Water Works continues to widen its market footprint through strategic acquisitions. In 2021, the company expanded its customer base by 20,000 through 23 closed acquisitions in six states.
American Water Works’ long-term (three to five years) earnings growth is currently pegged at 8.1%. The Zacks Consensus Estimate for AWK’s 2022 earnings implies year-over-year growth of 4.7%.
In 2021, Essential Utilities closed two acquisitions, which added 7,700 new customers. During the six years ended Dec 31, 2021, Essential Utilities expanded utility operations by completing many water and wastewater acquisitions, which, in turn, added 94,000 new customers.
Essential Utilities’ long-term earnings growth is currently pegged at 6.1%. The Zacks Consensus Estimate for WTRG’s 2022 earnings implies year-over-year growth of 6.6%.
Consolidated Water acquired 100% interest in Aerex Industries, Inc., a U.S. original equipment manufacturer and service provider of a wide range of products and services for industrial water treatment. Consolidated Water also acquired 51% of PERC Water Corporation, a water infrastructure provider, which expanded CWCO’s product offerings and presence in the United States. These acquired units continue to boost the company’s performance and expand the customer base.
Consolidated Water’s long-term earnings growth is currently pegged at 8%. The Zacks Consensus Estimate for Consolidated Water’s 2022 earnings implies year-over-year growth of 130.4%.