AMERICAN WATER WORKS CO INC (AWC.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:AWC - US0304201033 - Common Stock
110.3 EUR
-0.3 (-0.27%)
We assign a fundamental rating of 5 out of 10 to AWC. AWC was compared to 4 industry peers in the Water Utilities industry. AWC scores excellent on profitability, but there are concerns on its financial health. AWC has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year AWC was profitable.
- AWC had a positive operating cash flow in the past year.
- In the past 5 years AWC has always been profitable.
- In the past 5 years AWC always reported a positive cash flow from operatings.
1.2 Ratios
- AWC's Return On Assets of 3.20% is amongst the best of the industry. AWC outperforms 100.00% of its industry peers.
- AWC has a Return On Equity of 10.20%. This is amongst the best in the industry. AWC outperforms 100.00% of its industry peers.
- With an excellent Return On Invested Capital value of 4.57%, AWC belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for AWC is in line with the industry average of 4.57%.
- The last Return On Invested Capital (4.57%) for AWC is above the 3 year average (4.11%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.2% | ||
| ROE | 10.2% | ||
| ROIC | 4.57% |
ROA(3y)3.09%
ROA(5y)3.39%
ROE(3y)10.16%
ROE(5y)11.75%
ROIC(3y)4.11%
ROIC(5y)4.07%
1.3 Margins
- With an excellent Profit Margin value of 21.93%, AWC belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- AWC's Profit Margin has improved in the last couple of years.
- AWC has a better Operating Margin (36.96%) than 100.00% of its industry peers.
- AWC's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.96% | ||
| PM (TTM) | 21.93% | ||
| GM | N/A |
OM growth 3Y6.42%
OM growth 5Y1.75%
PM growth 3Y-11.29%
PM growth 5Y5.46%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AWC is destroying value.
- Compared to 1 year ago, AWC has about the same amount of shares outstanding.
- AWC has more shares outstanding than it did 5 years ago.
- AWC has a worse debt/assets ratio than last year.
2.2 Solvency
- AWC has an Altman-Z score of 1.00. This is a bad value and indicates that AWC is not financially healthy and even has some risk of bankruptcy.
- AWC's Altman-Z score of 1.00 is amongst the best of the industry. AWC outperforms 100.00% of its industry peers.
- A Debt/Equity ratio of 1.29 is on the high side and indicates that AWC has dependencies on debt financing.
- AWC's Debt to Equity ratio of 1.29 is amongst the best of the industry. AWC outperforms 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.29 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1 |
ROIC/WACC0.6
WACC7.59%
2.3 Liquidity
- AWC has a Current Ratio of 0.42. This is a bad value and indicates that AWC is not financially healthy enough and could expect problems in meeting its short term obligations.
- AWC has a better Current ratio (0.42) than 75.00% of its industry peers.
- AWC has a Quick Ratio of 0.42. This is a bad value and indicates that AWC is not financially healthy enough and could expect problems in meeting its short term obligations.
- AWC has a Quick ratio of 0.39. This is in the better half of the industry: AWC outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.42 | ||
| Quick Ratio | 0.39 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 12.35% over the past year.
- AWC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 7.98% yearly.
- The Revenue has grown by 12.29% in the past year. This is quite good.
- The Revenue has been growing slightly by 5.35% on average over the past years.
EPS 1Y (TTM)12.35%
EPS 3Y9.93%
EPS 5Y7.98%
EPS Q2Q%9.6%
Revenue 1Y (TTM)12.29%
Revenue growth 3Y6.02%
Revenue growth 5Y5.35%
Sales Q2Q%9.67%
3.2 Future
- The Earnings Per Share is expected to grow by 7.50% on average over the next years.
- AWC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.90% yearly.
EPS Next Y9.24%
EPS Next 2Y7.86%
EPS Next 3Y7.52%
EPS Next 5Y7.5%
Revenue Next Year10.35%
Revenue Next 2Y8.89%
Revenue Next 3Y8.24%
Revenue Next 5Y7.9%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- AWC is valuated rather expensively with a Price/Earnings ratio of 23.12.
- Compared to the rest of the industry, the Price/Earnings ratio of AWC indicates a rather cheap valuation: AWC is cheaper than 100.00% of the companies listed in the same industry.
- AWC is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
- AWC is valuated rather expensively with a Price/Forward Earnings ratio of 21.17.
- AWC's Price/Forward Earnings ratio is rather cheap when compared to the industry. AWC is cheaper than 100.00% of the companies in the same industry.
- AWC's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.12 | ||
| Fwd PE | 21.17 |
4.2 Price Multiples
- AWC's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. AWC is cheaper than 100.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.43 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates AWC does not grow enough to justify the current Price/Earnings ratio.
- AWC has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.5
PEG (5Y)2.9
EPS Next 2Y7.86%
EPS Next 3Y7.52%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.52%, AWC has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.45, AWC pays a bit more dividend than its industry peers.
- AWC's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.52% |
5.2 History
- The dividend of AWC is nicely growing with an annual growth rate of 9.01%!
Dividend Growth(5Y)9.01%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
- AWC pays out 55.85% of its income as dividend. This is a bit on the high side, but may be sustainable.
- AWC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP55.85%
EPS Next 2Y7.86%
EPS Next 3Y7.52%
AMERICAN WATER WORKS CO INC / AWC.DE FAQ
What is the fundamental rating for AWC stock?
ChartMill assigns a fundamental rating of 5 / 10 to AWC.DE.
What is the valuation status for AWC stock?
ChartMill assigns a valuation rating of 4 / 10 to AMERICAN WATER WORKS CO INC (AWC.DE). This can be considered as Fairly Valued.
What is the profitability of AWC stock?
AMERICAN WATER WORKS CO INC (AWC.DE) has a profitability rating of 8 / 10.
What is the valuation of AMERICAN WATER WORKS CO INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for AMERICAN WATER WORKS CO INC (AWC.DE) is 23.12 and the Price/Book (PB) ratio is 2.34.
Can you provide the expected EPS growth for AWC stock?
The Earnings per Share (EPS) of AMERICAN WATER WORKS CO INC (AWC.DE) is expected to grow by 9.24% in the next year.