AMERICAN STATES WATER CO (AWR) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AWR - US0298991011 - Common Stock
73.16 USD
-1.47 (-1.97%)
73.16 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to AWR. AWR was compared to 14 industry peers in the Water Utilities industry. AWR scores excellent on profitability, but there are some minor concerns on its financial health. AWR has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year AWR was profitable.
- AWR had a positive operating cash flow in the past year.
- Each year in the past 5 years AWR has been profitable.
- Each year in the past 5 years AWR had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 4.88%, AWR is in the better half of the industry, outperforming 78.57% of the companies in the same industry.
- The Return On Equity of AWR (12.84%) is better than 92.86% of its industry peers.
- AWR's Return On Invested Capital of 6.19% is amongst the best of the industry. AWR outperforms 85.71% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for AWR is in line with the industry average of 4.99%.
- The 3 year average ROIC (6.15%) for AWR is below the current ROIC(6.19%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.88% | ||
| ROE | 12.84% | ||
| ROIC | 6.19% |
ROA(3y)4.71%
ROA(5y)4.78%
ROE(3y)13.33%
ROE(5y)13.42%
ROIC(3y)6.15%
ROIC(5y)6.12%
1.3 Margins
- Looking at the Profit Margin, with a value of 20.35%, AWR is in line with its industry, outperforming 57.14% of the companies in the same industry.
- AWR's Profit Margin has improved in the last couple of years.
- With a Operating Margin value of 30.92%, AWR perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
- AWR's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 81.56%, AWR belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
- In the last couple of years the Gross Margin of AWR has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.92% | ||
| PM (TTM) | 20.35% | ||
| GM | 81.56% |
OM growth 3Y3.23%
OM growth 5Y2.98%
PM growth 3Y1.9%
PM growth 5Y2.4%
GM growth 3Y1.3%
GM growth 5Y0.64%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AWR is destroying value.
- The number of shares outstanding for AWR has been increased compared to 1 year ago.
- The number of shares outstanding for AWR has been increased compared to 5 years ago.
- AWR has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 1.86 indicates that AWR is not a great score, but indicates only limited risk for bankruptcy at the moment.
- The Altman-Z score of AWR (1.86) is better than 78.57% of its industry peers.
- AWR has a debt to FCF ratio of 26.20. This is a negative value and a sign of low solvency as AWR would need 26.20 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 26.20, AWR belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
- AWR has a Debt/Equity ratio of 0.91. This is a neutral value indicating AWR is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.91, AWR perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 26.2 | ||
| Altman-Z | 1.86 |
ROIC/WACC0.72
WACC8.55%
2.3 Liquidity
- AWR has a Current Ratio of 1.27. This is a normal value and indicates that AWR is financially healthy and should not expect problems in meeting its short term obligations.
- With an excellent Current ratio value of 1.27, AWR belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
- AWR has a Quick Ratio of 1.18. This is a normal value and indicates that AWR is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of AWR (1.18) is better than 78.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.27 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
- AWR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.80%, which is quite good.
- AWR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.28% yearly.
- Looking at the last year, AWR shows a quite strong growth in Revenue. The Revenue has grown by 10.28% in the last year.
- Measured over the past years, AWR shows a small growth in Revenue. The Revenue has been growing by 4.67% on average per year.
EPS 1Y (TTM)13.8%
EPS 3Y7.52%
EPS 5Y8.28%
EPS Q2Q%11.58%
Revenue 1Y (TTM)10.28%
Revenue growth 3Y6.07%
Revenue growth 5Y4.67%
Sales Q2Q%12.94%
3.2 Future
- The Earnings Per Share is expected to grow by 5.90% on average over the next years.
- Based on estimates for the next years, AWR will show a small growth in Revenue. The Revenue will grow by 4.34% on average per year.
EPS Next Y5.78%
EPS Next 2Y5.45%
EPS Next 3Y6.06%
EPS Next 5Y5.9%
Revenue Next Year5.66%
Revenue Next 2Y5.19%
Revenue Next 3Y4.76%
Revenue Next 5Y4.34%
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 decreasing.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 21.64 indicates a rather expensive valuation of AWR.
- AWR's Price/Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, AWR is valued a bit cheaper.
- Based on the Price/Forward Earnings ratio of 20.76, the valuation of AWR can be described as rather expensive.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of AWR is on the same level as its industry peers.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. AWR is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.64 | ||
| Fwd PE | 20.76 |
4.2 Price Multiples
- AWR's Enterprise Value to EBITDA ratio is in line with the industry average.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of AWR indicates a rather cheap valuation: AWR is cheaper than 92.86% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 81.1 | ||
| EV/EBITDA | 15.21 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates AWR does not grow enough to justify the current Price/Earnings ratio.
- AWR has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.75
PEG (5Y)2.62
EPS Next 2Y5.45%
EPS Next 3Y6.06%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.70%, AWR has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.93, AWR has a dividend in line with its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, AWR pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
5.2 History
- On average, the dividend of AWR grows each year by 8.98%, which is quite nice.
- AWR has been paying a dividend for at least 10 years, so it has a reliable track record.
- AWR has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.98%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
- 56.10% of the earnings are spent on dividend by AWR. This is a bit on the high side, but may be sustainable.
- The dividend of AWR is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP56.1%
EPS Next 2Y5.45%
EPS Next 3Y6.06%
AMERICAN STATES WATER CO / AWR FAQ
What is the ChartMill fundamental rating of AMERICAN STATES WATER CO (AWR) stock?
ChartMill assigns a fundamental rating of 6 / 10 to AWR.
What is the valuation status of AMERICAN STATES WATER CO (AWR) stock?
ChartMill assigns a valuation rating of 4 / 10 to AMERICAN STATES WATER CO (AWR). This can be considered as Fairly Valued.
Can you provide the profitability details for AMERICAN STATES WATER CO?
AMERICAN STATES WATER CO (AWR) has a profitability rating of 8 / 10.
Can you provide the financial health for AWR stock?
The financial health rating of AMERICAN STATES WATER CO (AWR) is 5 / 10.
What is the expected EPS growth for AMERICAN STATES WATER CO (AWR) stock?
The Earnings per Share (EPS) of AMERICAN STATES WATER CO (AWR) is expected to grow by 5.78% in the next year.