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American Water Works (AWK) Q4 Earnings In Line, Revenues Lag

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American Water Works Company (AWK - Free Report) posted fourth-quarter 2018 earnings per share of 69 cents, which is in line with the Zacks Consensus Estimate and the year-ago figure.
 
The company reported GAAP earnings of 62 cents against loss of 1 cent in the year-ago quarter.

Total Revenues
 
Total revenues of $850 million lagged the Zacks Consensus Estimate of $867 million by 2% but increased 3.5% from the year-ago figure of $821 million.

Highlights of the Release
 
Total operating expenses in the quarter were $602 million, up 11.1% from the year-ago period. The increase was primarily led by greater operation and maintenance expenses than the year-ago quarter.

Operating income was $248 million, down 11.1% year over year.

Segment Details
 
Regulated businesses’ net income was $118 million compared with $119 million in the year-ago quarter. Regulated businesses added 25,000 customers in 2018 through acquisitions and organic growth. The company is looking forward to add another 61,000 customers through acquisitions that are awaiting regulatory approval.

Market-Based businesses’ net income was $14 million, in line with the year-ago quarter.
 
Financial Highlights

Cash and cash equivalents were $ 130 million as of Dec 31, 2018, up 136.4% from the corresponding period of last year.
 
Long-term debt was $7,576 million as of Dec 31, 2018, higher than $6,498 million on Dec 31, 2017.

In 2018, the company made capital investments of $1.5 billion to strengthen its water and wastewater systems.

Guidance

American Water Works has affirmed its 2019 earnings guidance in the range of $3.54-$3.64 per share.
 
American Water Works plans to invest $8.0-$8.6 billion over the next five years and expects long-term EPS compound annual growth rate in top half of 7-10% range, anchored off 2017 EPS.

Zacks Rank

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

Other Releases

Aqua America Inc. reported fourth-quarter 2018 earnings per share of 31 cents, lagging the Zacks Consensus Estimate by a penny.

Upcoming Water Utility Releases

American States Water Co. (AWR - Free Report) is expected to release fourth-quarter 2018 earnings on Feb 25, 2019. The Zacks Consensus Estimate for the quarter is pegged at 37 cents.

Global Water Resources, Inc. (GWRS - Free Report) is expected to release fourth-quarter 2018 earnings on Mar 7, 2019. The Zacks Consensus Estimate for the quarter to be reported is pegged at 1 cent.

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