AMERICAN WATER WORKS CO INC (AWK)
US0304201033 - Common Stock
Taking everything into account, AWK scores 4 out of 10 in our fundamental rating. AWK was compared to 14 industry peers in the Water Utilities industry. While AWK is still in line with the averages on profitability rating, there are concerns on its financial health. AWK is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
AWK had positive earnings in the past year.
In the past year AWK had a positive cash flow from operations.
AWK had positive earnings in each of the past 5 years.
AWK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
AWK has a Return On Assets of 3.09%. This is comparable to the rest of the industry: AWK outperforms 42.86% of its industry peers.
With a decent Return On Equity value of 9.49%, AWK is doing good in the industry, outperforming 64.29% of the companies in the same industry.
AWK has a Return On Invested Capital of 4.34%. This is in the better half of the industry: AWK outperforms 71.43% of its industry peers.
The Average Return On Invested Capital over the past 3 years for AWK is in line with the industry average of 5.71%.
The 3 year average ROIC (4.02%) for AWK is below the current ROIC(4.34%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.09% | ||
| ROE | 9.49% | ||
| ROIC | 4.34% |
ROA(3y)3.64%
ROA(5y)3.3%
ROE(3y)12.53%
ROE(5y)11.75%
ROIC(3y)4.02%
ROIC(5y)4.18%
1.3 Margins
AWK has a Profit Margin (21.77%) which is comparable to the rest of the industry.
AWK's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 35.81%, AWK is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
AWK's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 35.81% | ||
| PM (TTM) | 21.77% | ||
| GM | N/A |
OM growth 3Y2.44%
OM growth 5Y1.42%
PM growth 3Y5.9%
PM growth 5Y6.23%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
AWK has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, AWK has more shares outstanding
The number of shares outstanding for AWK has been increased compared to 5 years ago.
The debt/assets ratio for AWK has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.05, we must say that AWK is in the distress zone and has some risk of bankruptcy.
AWK's Altman-Z score of 1.05 is in line compared to the rest of the industry. AWK outperforms 57.14% of its industry peers.
A Debt/Equity ratio of 1.23 is on the high side and indicates that AWK has dependencies on debt financing.
AWK has a Debt to Equity ratio of 1.23. This is in the lower half of the industry: AWK underperforms 64.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.05 |
ROIC/WACC0.61
WACC7.1%
2.3 Liquidity
A Current Ratio of 0.58 indicates that AWK may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.58, AWK is doing worse than 85.71% of the companies in the same industry.
A Quick Ratio of 0.53 indicates that AWK may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.53, AWK is doing worse than 85.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.58 | ||
| Quick Ratio | 0.53 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 3.51% over the past year.
The Earnings Per Share has been growing by 8.77% on average over the past years. This is quite good.
Looking at the last year, AWK shows a quite strong growth in Revenue. The Revenue has grown by 9.24% in the last year.
AWK shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.24% yearly.
EPS 1Y (TTM)3.51%
EPS 3Y8.92%
EPS 5Y8.77%
EPS Q2Q%1.72%
Revenue 1Y (TTM)9.24%
Revenue growth 3Y3.88%
Revenue growth 5Y4.24%
Sales Q2Q%13.37%
3.2 Future
The Earnings Per Share is expected to grow by 6.82% on average over the next years.
The Revenue is expected to grow by 7.27% on average over the next years.
EPS Next Y5.59%
EPS Next 2Y6.93%
EPS Next 3Y7.18%
EPS Next 5Y6.82%
Revenue Next Year8.74%
Revenue Next 2Y7.33%
Revenue Next 3Y7.22%
Revenue Next 5Y7.27%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.42, which indicates a rather expensive current valuation of AWK.
Compared to the rest of the industry, the Price/Earnings ratio of AWK is on the same level as its industry peers.
AWK is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.48, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 21.27, the valuation of AWK can be described as rather expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as AWK.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.73, AWK is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.42 | ||
| Fwd PE | 21.27 |
4.2 Price Multiples
AWK's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AWK is cheaper than 64.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 15.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
AWK has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.37
PEG (5Y)2.78
EPS Next 2Y6.93%
EPS Next 3Y7.18%
5. Dividend
5.1 Amount
AWK has a Yearly Dividend Yield of 2.47%.
Compared to an average industry Dividend Yield of 3.52, AWK has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.33, AWK has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
5.2 History
The dividend of AWK is nicely growing with an annual growth rate of 9.71%!
AWK has been paying a dividend for at least 10 years, so it has a reliable track record.
AWK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.71%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
58.29% of the earnings are spent on dividend by AWK. This is a bit on the high side, but may be sustainable.
AWK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP58.29%
EPS Next 2Y6.93%
EPS Next 3Y7.18%
AMERICAN WATER WORKS CO INC
NYSE:AWK (1/6/2025, 3:00:05 PM)
122.595
-1.17 (-0.95%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners93.77%
Inst Owner Change0%
Ins Owners0.11%
Ins Owner Change-0.21%
Market Cap23.89B
Analysts68
Price Target145.72 (18.86%)
Short Float %2.39%
Short Ratio3.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
Dividend Growth(5Y)9.71%
DP58.29%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.72%
Min EPS beat(2)-4.73%
Max EPS beat(2)-4.7%
EPS beat(4)1
Avg EPS beat(4)-1.38%
Min EPS beat(4)-5.83%
Max EPS beat(4)9.75%
EPS beat(8)3
Avg EPS beat(8)0.01%
EPS beat(12)6
Avg EPS beat(12)-0.82%
EPS beat(16)7
Avg EPS beat(16)-0.55%
Revenue beat(2)2
Avg Revenue beat(2)4.11%
Min Revenue beat(2)2.04%
Max Revenue beat(2)6.18%
Revenue beat(4)4
Avg Revenue beat(4)2.59%
Min Revenue beat(4)0.19%
Max Revenue beat(4)6.18%
Revenue beat(8)7
Avg Revenue beat(8)2.81%
Revenue beat(12)8
Avg Revenue beat(12)0.32%
Revenue beat(16)9
Avg Revenue beat(16)-0.74%
PT rev (1m)0.21%
PT rev (3m)-1.2%
EPS NQ rev (1m)0%
EPS NQ rev (3m)10.81%
EPS NY rev (1m)0%
EPS NY rev (3m)0.38%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)3.23%
Revenue NY rev (1m)0.39%
Revenue NY rev (3m)0.9%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.42 | ||
| Fwd PE | 21.27 | ||
| P/S | 5.29 | ||
| P/FCF | N/A | ||
| P/OCF | 12.36 | ||
| P/B | 2.31 | ||
| P/tB | 2.59 | ||
| EV/EBITDA | 15.61 |
EPS(TTM)5.02
EY4.09%
EPS(NY)5.76
Fwd EY4.7%
FCF(TTM)-4.23
FCFYN/A
OCF(TTM)9.92
OCFY8.09%
SpS23.17
BVpS53.17
TBVpS47.3
PEG (NY)4.37
PEG (5Y)2.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.09% | ||
| ROE | 9.49% | ||
| ROCE | 5.45% | ||
| ROIC | 4.34% | ||
| ROICexc | 4.36% | ||
| ROICexgc | 4.53% | ||
| OM | 35.81% | ||
| PM (TTM) | 21.77% | ||
| GM | N/A | ||
| FCFM | N/A |
ROA(3y)3.64%
ROA(5y)3.3%
ROE(3y)12.53%
ROE(5y)11.75%
ROIC(3y)4.02%
ROIC(5y)4.18%
ROICexc(3y)4.05%
ROICexc(5y)4.22%
ROICexgc(3y)4.23%
ROICexgc(5y)4.48%
ROCE(3y)5.15%
ROCE(5y)5.4%
ROICexcg growth 3Y-2.05%
ROICexcg growth 5Y-2.08%
ROICexc growth 3Y-0.88%
ROICexc growth 5Y-1.2%
OM growth 3Y2.44%
OM growth 5Y1.42%
PM growth 3Y5.9%
PM growth 5Y6.23%
GM growth 3YN/A
GM growth 5YN/A
F-Score5
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.37 | ||
| Cap/Depr | 361.94% | ||
| Cap/Sales | 61.09% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 81.25% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.58 | ||
| Quick Ratio | 0.53 | ||
| Altman-Z | 1.05 |
F-Score5
WACC7.1%
ROIC/WACC0.61
Cap/Depr(3y)332.35%
Cap/Depr(5y)316.58%
Cap/Sales(3y)55.43%
Cap/Sales(5y)52.07%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)3.51%
EPS 3Y8.92%
EPS 5Y8.77%
EPS Q2Q%1.72%
EPS Next Y5.59%
EPS Next 2Y6.93%
EPS Next 3Y7.18%
EPS Next 5Y6.82%
Revenue 1Y (TTM)9.24%
Revenue growth 3Y3.88%
Revenue growth 5Y4.24%
Sales Q2Q%13.37%
Revenue Next Year8.74%
Revenue Next 2Y7.33%
Revenue Next 3Y7.22%
Revenue Next 5Y7.27%
EBIT growth 1Y10.3%
EBIT growth 3Y6.42%
EBIT growth 5Y5.72%
EBIT Next Year62.16%
EBIT Next 3Y25.33%
EBIT Next 5Y17.97%
FCF growth 1Y15.82%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y64.37%
OCF growth 3Y9.53%
OCF growth 5Y6.22%