A month has gone by since the last earnings report for American States Water (AWR Quick QuoteAWR - Free Report) . Shares have added about 4.7% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is American States Water due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

AWR Q2 Earnings Top Estimates on Water Rate Increases, Revenues Up Y/Y

American States Water Company reported second-quarter 2026 earnings of $1.09 per share, up 25.3% year over year and beating the Zacks Consensus Estimate of 93 cents by 17.2%. Higher earnings at the water utility, driven largely by CPUC-approved rate increases, supported the gain.

Total Revenues

Operating revenues rose 11.2% to $181.29 million from $163.07 million. Water consumption increased about 4%, while contracted services revenues advanced 20.3%, adding to the quarter’s growth.

Water segment revenues increased 9.5% year over year to $131.05 million. The increase mainly reflected second-year customer rate increases effective Jan. 1, 2026, additional revenues tied to approved capital projects and higher water consumption. Lower billed surcharges partly offset these gains.

Contracted Services revenues rose 20.3% to $36.61 million, while Electric segment revenues increased 5.4% to $13.63 million. The Electric revenues were $13.6 million, up 5.4% year over year, and the increase reflects authorized 2026 rate increases and additional recovery on completed capital projects, partly offset by lower billed surcharges.

AWR's Operational Highlights

Operating expenses increased 4.6% to $117.32 million. ASUS construction expense climbed 29.9% to $16.75 million, while depreciation and amortization rose 9.1% to $12.75 million. Administrative and general expenses declined 2.8% to $24.52 million.

Operating income increased 25.5% to $63.97 million. Interest expense was $12.17 million, up 0.5%, while other income, net, increased 41.8% to $5.07 million. Net income rose 28.4% to $43.27 million.

American States Water Strengthens Cash Flow

Cash provided by operating activities totaled $116.6 million in the first six months of 2026, compared with $109.6 million a year earlier. The improvement reflected new regulated utility rates, various surcharges, about $4 million of proceeds from PFAS contamination litigation and working-capital timing.

The regulated utilities invested $91.7 million in company-funded capital work year to date. American States Water expects regulated utility capital expenditures of $185-$220 million in 2026. Cash and cash equivalents stood at $21.66 million at June 30, up from $18.82 million at year-end 2025.

AWR's Rate Cases Set the Regulatory Backdrop

Golden State Water filed its 2028-2030 general rate case on July 1, seeking nearly $1 billion of capital budgets for the three-year cycle. It also requested reinstatement of the WRAM and MCBA regulatory mechanisms. A decision is scheduled for the fourth quarter of 2027, with new rates targeted for Jan. 1, 2028.

Bear Valley Electric filed its 2027-2030 rate case in January. The application seeks about $133 million of capital budgets, plus roughly $17 million, along with an allowance for funds used during construction, for projects to be recovered through advice letters.

American States Water Boosts Shareholder Returns

The board approved an 8.2% increase in the third-quarter dividend to 54.55 cents per share from 50.40 cents. This increase marks the 72nd consecutive calendar year in which AWR has raised annual dividends to its shareholders.

AWR also completed its at-the-market equity offering program in June after reaching the $200 million maximum aggregate offering capacity. The company said no further shares will be sold under that program and it has no plans to issue additional equity through at least the end of 2029 to support current operations.

AWR’s Guidance

American States Water’s capital expenditures for 2026 are expected to be $185-$220 million.

Contracted Services (“ASUS”) is projected to contribute 63-67 cents per share in 2026.

 

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

At this time, American States Water has a average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, the stock has a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

American States Water has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

American States Water belongs to the Zacks Utility - Water Supply industry. Another stock from the same industry, American Water Works (AWK Quick QuoteAWK - Free Report) , has gained 4.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.

American Water Works reported revenues of $1.36 billion in the last reported quarter, representing a year-over-year change of +6.2%. EPS of $1.61 for the same period compares with $1.48 a year ago.

For the current quarter, American Water Works is expected to post earnings of $2.11 per share, indicating a change of +8.8% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.5% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for American Water Works. Also, the stock has a VGM Score of D.