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WTRG Unit Expands Water Operations With Lake Tamarack Acquisition

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Key Takeaways

  • WTRG's Aqua New Jersey acquired Lake Tamarack's water system for $113,000, adding roughly 255 customers.
  • WTRG plans to invest $1.4M in the acquired system to upgrade aging infrastructure and operations.
  • WTRG has added over 138,000 customers through acquisitions since 2015 and is pursuing further expansion.

Essential Utilities, Inc. (WTRG - Free Report) announced that its unit, Aqua New Jersey, had completed the acquisition of the Lake Tamarack Water Corporation’s water system assets in Sussex County, NJ, for $113,000. The acquisition will add approximately 255 customers in the Lake Tamarack section of Hardyston Township to the company’s customer base. 

A substantial portion of the water and wastewater infrastructure is nearing the end of its service life, creating a need for continued investment. The Lake Tamarack Water Corporation’s system also requires capital investment to upgrade infrastructure, improve operational efficiency and meet regulatory, environmental and cybersecurity requirements. Essential Utilities plans to invest approximately $1.4 million in the acquired system over the next several years. 

Essential Utilities continues to expand its regulated water and wastewater operations through acquisitions. Since 2015, the company has added more than 138,000 customers or equivalent dwelling units and approximately $570 million in rate base through acquisitions.

On Sept. 30, 2026, its subsidiary, Aqua Pennsylvania, completed the $450,000 acquisition of the Ulster Municipal Authority’s water system in Bradford County, PA, adding approximately 180 customers. The company also acquired Integra Water Texas in May 2026 for approximately $4.9 million.

Consolidation Drives Investment in Water Infrastructure

According to the U.S. Environmental Protection Agency’s Environmental Finance Advisory Board, the U.S. water industry remains highly fragmented, with approximately 50,000 community water systems and 14,500 permitted wastewater systems. Many smaller utilities face financial and technical constraints when upgrading aging infrastructure, underscoring the need for capital investment to improve operational efficiency, maintain service reliability and reduce water loss.

Mergers and acquisitions help improve service quality, reduce costs and support infrastructure investment. Larger utilities acquire smaller systems, funding upgrades, modernizing infrastructure and expanding service territories.

American Water Works (AWK - Free Report) added 52,000 customer connections through acquisitions as of June 30, 2026, and plans to invest $19-$20 billion during 2026-2030. AWK’s proposed merger with WTRG remains on track to close in the first quarter of 2027, subject to regulatory approvals and other closing conditions. The all-stock transaction is expected to create a combined utility with a market capitalization of approximately $40 billion and serve more than 4.7 million water and wastewater customer connections.

California Water Service Group (CWT - Free Report) completed the acquisition of Palm Mutual Water Company on July 1, 2026, adding 63 residential customer connections serving approximately 250 residents. The company expects to invest up to $627 million in infrastructure in 2026 to support reliable water service and system improvements.

Other Stocks to Consider

Another top-ranked stock in the same sector is Consolidated Edison (ED - Free Report) , which currently carries a Zacks Rank #2 (Buy).

The Zacks Consensus Estimate for 2026 earnings for Consolidated Edison is pegged at $6.10 per share, suggesting year-over-year growth of 7.02%. ED is projected to deliver long-term (three to five years) earnings growth of 4.74%.

Price Movement of WTRG

In the past three months, the stock of the company has risen 2.7% compared with the industry’s 1.4% growth.

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Zacks Rank

WTRG currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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