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American Water's (AWK) Pennsylvania Arm to Invest in Upgrades
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American Water Works (AWK - Free Report) announced that its unit, Pennsylvania American Water, will invest $22 million to upgrade its Hays Mine Water Treatment Plant. The company will replace infrastructure nearing the end of its useful life.
The upgrades in the plant’s safety, controls and equipment will ensure the continuous supply of high-quality water to AWK’s 132,000 customers in southern Allegheny County. Pennsylvania American Water will change 16 water filters, caustic soda tanks and solid handling equipment to keep the treatment plant running efficiently.
The Pennsylvanian unit has been upgrading and maintaining its water and wastewater infrastructure and has invested nearly $490 million in 2022 for infrastructure upgrades. As of now, the company has invested $85 million in 2023 to improve its water and sewer systems in Allegheny, Fayette and Washington counties, including installing 33 miles of new water mains to enhance service reliability, fire protection and rehabilitating 3.6 miles of aging sewer mains. Proper infrastructure maintenance allows Pennsylvania American Water to serve its 2.3 million customers efficiently.
Aging Infrastructures Need Investment
Per the U.S. Environmental Protection Agency, investments of $473 billion and $271 billion are necessary to maintain and expand drinking water and wastewater pipelines, respectively, to meet demand over the next 20 years. Water infrastructure, like storage tanks and purifying units, needs maintenance at proper intervals.
The repair and upgrade of other infrastructures like overhead storage tanks, treatment plants and water reservoirs are quite essential to providing uninterrupted 24x7 services to customers.
Per the ASCE report, nearly 6 billion gallons of treated water is lost each day in the United States due to water main breaks every two minutes. This wastage of potable water is increasing the cost of operations for water utilities.
Miles of aging pipelines essentially require repairs and upgrades to maintain quality water service. A delay in repair could cause frequent disruptions in the 24x7 supply of potable water and sewer services.
Utilities Making Investments
Water utilities like Essential Utilities (WTRG - Free Report) , California Water Service Group (CWT - Free Report) and Middlesex Water (MSEX - Free Report) , among others, have well-chalked-out capital investment plans to strengthen infrastructure.
Essential Utilities plans to invest $1.1 billion in 2023 and $3.3 billion through 2025 to improve the water and natural gas systems and better serve customers using improved information technology. California Water Service plans to invest more than $625 million in capital expenditures through 2024. Middlesex Water plans to invest $266 million during 2023-2025 to strengthen its water and wastewater infrastructure and provide services to customers in a safe, reliable and efficient manner.
The Zacks Consensus Estimate for WTRG and CWT’s 2023 earnings indicates year-over-year growth of 5.1% and 7.9%, respectively. MSEX’s 2023 earnings estimates have moved up 0.5% in the past 60 days.
Price Performance
Over the last six months, American Water Works’ stock gained 1.2% compared with the industry’s growth of 0.5%.
Image Source: Zacks Investment Research
Zacks Rank
American Water currently has a Zacks Rank #2 (Buy).
Image: Bigstock
American Water's (AWK) Pennsylvania Arm to Invest in Upgrades
American Water Works (AWK - Free Report) announced that its unit, Pennsylvania American Water, will invest $22 million to upgrade its Hays Mine Water Treatment Plant. The company will replace infrastructure nearing the end of its useful life.
The upgrades in the plant’s safety, controls and equipment will ensure the continuous supply of high-quality water to AWK’s 132,000 customers in southern Allegheny County. Pennsylvania American Water will change 16 water filters, caustic soda tanks and solid handling equipment to keep the treatment plant running efficiently.
The Pennsylvanian unit has been upgrading and maintaining its water and wastewater infrastructure and has invested nearly $490 million in 2022 for infrastructure upgrades. As of now, the company has invested $85 million in 2023 to improve its water and sewer systems in Allegheny, Fayette and Washington counties, including installing 33 miles of new water mains to enhance service reliability, fire protection and rehabilitating 3.6 miles of aging sewer mains. Proper infrastructure maintenance allows Pennsylvania American Water to serve its 2.3 million customers efficiently.
Aging Infrastructures Need Investment
Per the U.S. Environmental Protection Agency, investments of $473 billion and $271 billion are necessary to maintain and expand drinking water and wastewater pipelines, respectively, to meet demand over the next 20 years. Water infrastructure, like storage tanks and purifying units, needs maintenance at proper intervals.
The repair and upgrade of other infrastructures like overhead storage tanks, treatment plants and water reservoirs are quite essential to providing uninterrupted 24x7 services to customers.
Per the ASCE report, nearly 6 billion gallons of treated water is lost each day in the United States due to water main breaks every two minutes. This wastage of potable water is increasing the cost of operations for water utilities.
Miles of aging pipelines essentially require repairs and upgrades to maintain quality water service. A delay in repair could cause frequent disruptions in the 24x7 supply of potable water and sewer services.
Utilities Making Investments
Water utilities like Essential Utilities (WTRG - Free Report) , California Water Service Group (CWT - Free Report) and Middlesex Water (MSEX - Free Report) , among others, have well-chalked-out capital investment plans to strengthen infrastructure.
Essential Utilities plans to invest $1.1 billion in 2023 and $3.3 billion through 2025 to improve the water and natural gas systems and better serve customers using improved information technology. California Water Service plans to invest more than $625 million in capital expenditures through 2024. Middlesex Water plans to invest $266 million during 2023-2025 to strengthen its water and wastewater infrastructure and provide services to customers in a safe, reliable and efficient manner.
The Zacks Consensus Estimate for WTRG and CWT’s 2023 earnings indicates year-over-year growth of 5.1% and 7.9%, respectively. MSEX’s 2023 earnings estimates have moved up 0.5% in the past 60 days.
Price Performance
Over the last six months, American Water Works’ stock gained 1.2% compared with the industry’s growth of 0.5%.
Image Source: Zacks Investment Research
Zacks Rank
American Water currently has a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.