We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is it Time to Add American Water Works (AWK) to Portfolio?
Read MoreHide Full Article
Shares of water and wastewater service provider, American Water Works Company (AWK - Free Report) returned 7.28% in the last one month, outperforming the Zacks categorized Utility Water Supply industry’s increase of 4.91% in the same time period.
American Water Works’ consistent investments to strengthen regulated business, strategic acquisitions, and research and development activities to improve the quality of water are the primary catalysts behind the strong performance. Incidentally the company has surpassed the Zacks Consensus Estimate in the trailing four quarters with average positive earnings surprise of 3.43%.
The company aims to invest $6.7–$7.3 billion from 2017 through 2021, which will help it to improve earnings by 7–10% per year in the aforesaid period from a 2015 base. A major chunk of $5.9 billion will be directed to strengthen regulated businesses. More than 90% of its net income comes from regulated operations.
Consolidation is the need of the hour in the fragmented U.S. water utility space. American Water Works continues to expand operation through strategic acquisitions. During the 2016, the company added 42,000 customers to customer base through acquisitions. Another 40,000 customers will be added when the pending acquisitions have been completed by the company in 2017.
American Water Works also has a high quality research and development (R&D) program that ensures high quality of the water supplied to the customers. Consistent R&D is essential for providing high quality water to expanding customer base.
The company’s fourth-quarter 2016 earnings per share of 57 cents were higher than the Zacks Consensus estimate by 1.1% and the year-ago figure by 3.6%.The increase in earnings can be attributable to higher earnings at the Regulated businesses and Market-based businesses segments.
Its 2017 and 2018 earnings estimates moved up by 3.9% and 3.6% respectively to $2.15 and $2.29 in the last 30 days.
Zacks Rank & Others Key Picks
Apart from American Water Works which carries a Zacks Rank #2 (Buy), other favorably placed water utilities worth adding to your portfolio are Artesian Resource Corporation (ARTNA - Free Report) , Pure Cycle Corporation (PCYO - Free Report) and SJW Corporation (SJW - Free Report) .
SJW Corporation carries a Zacks Rank #2 and has reported a positive surprise of 3.08% in the last quarter.
Pure Cycle Corporation also carries a Zacks Rank #2 and has reported a positive surprise of 50% in the last quarter.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Is it Time to Add American Water Works (AWK) to Portfolio?
Shares of water and wastewater service provider, American Water Works Company (AWK - Free Report) returned 7.28% in the last one month, outperforming the Zacks categorized Utility Water Supply industry’s increase of 4.91% in the same time period.
American Water Works’ consistent investments to strengthen regulated business, strategic acquisitions, and research and development activities to improve the quality of water are the primary catalysts behind the strong performance. Incidentally the company has surpassed the Zacks Consensus Estimate in the trailing four quarters with average positive earnings surprise of 3.43%.
The company aims to invest $6.7–$7.3 billion from 2017 through 2021, which will help it to improve earnings by 7–10% per year in the aforesaid period from a 2015 base. A major chunk of $5.9 billion will be directed to strengthen regulated businesses. More than 90% of its net income comes from regulated operations.
Consolidation is the need of the hour in the fragmented U.S. water utility space. American Water Works continues to expand operation through strategic acquisitions. During the 2016, the company added 42,000 customers to customer base through acquisitions. Another 40,000 customers will be added when the pending acquisitions have been completed by the company in 2017.
American Water Works also has a high quality research and development (R&D) program that ensures high quality of the water supplied to the customers. Consistent R&D is essential for providing high quality water to expanding customer base.
The company’s fourth-quarter 2016 earnings per share of 57 cents were higher than the Zacks Consensus estimate by 1.1% and the year-ago figure by 3.6%.The increase in earnings can be attributable to higher earnings at the Regulated businesses and Market-based businesses segments.
American Water Works Price and EPS Surprise
American Water Works Price and EPS Surprise | American Water Works Quote
Its 2017 and 2018 earnings estimates moved up by 3.9% and 3.6% respectively to $2.15 and $2.29 in the last 30 days.
Zacks Rank & Others Key Picks
Apart from American Water Works which carries a Zacks Rank #2 (Buy), other favorably placed water utilities worth adding to your portfolio are Artesian Resource Corporation (ARTNA - Free Report) , Pure Cycle Corporation (PCYO - Free Report) and SJW Corporation (SJW - Free Report) .
Artesian Resource Corporation sports a Zacks Rank #1 (Strong Buy) and its shares have gained 5.7% year to date. You can see the complete list of today's Zacks #1 Rank stocks here.
SJW Corporation carries a Zacks Rank #2 and has reported a positive surprise of 3.08% in the last quarter.
Pure Cycle Corporation also carries a Zacks Rank #2 and has reported a positive surprise of 50% in the last quarter.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>