CALIFORNIA WATER SERVICE GRP (CWT) Stock Fundamental Analysis
NYSE:CWT - New York Stock Exchange, Inc. - US1307881029 - Common Stock - Currency: USD
CWT gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 14 industry peers in the Water Utilities industry. There are concerns on the financial health of CWT while its profitability can be described as average. CWT does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year CWT was profitable.
CWT had a positive operating cash flow in the past year.
Each year in the past 5 years CWT has been profitable.
Each year in the past 5 years CWT had a positive operating cash flow.
1.2 Ratios
CWT has a worse Return On Assets (2.55%) than 64.29% of its industry peers.
CWT's Return On Equity of 8.24% is on the low side compared to the rest of the industry. CWT is outperformed by 64.29% of its industry peers.
CWT has a Return On Invested Capital of 3.29%. This is comparable to the rest of the industry: CWT outperforms 42.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CWT is below the industry average of 5.08%.
The last Return On Invested Capital (3.29%) for CWT is above the 3 year average (2.65%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.55% | ||
| ROE | 8.24% | ||
| ROIC | 3.29% |
ROA(3y)2.35%
ROA(5y)2.54%
ROE(3y)7.53%
ROE(5y)8.34%
ROIC(3y)2.65%
ROIC(5y)2.93%
1.3 Margins
Looking at the Profit Margin, with a value of 13.84%, CWT is doing worse than 64.29% of the companies in the same industry.
CWT's Profit Margin has improved in the last couple of years.
The Operating Margin of CWT (21.18%) is worse than 64.29% of its industry peers.
In the last couple of years the Operating Margin of CWT has grown nicely.
CWT has a better Gross Margin (70.34%) than 71.43% of its industry peers.
CWT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.18% | ||
| PM (TTM) | 13.84% | ||
| GM | 70.34% |
OM growth 3Y15.39%
OM growth 5Y9.23%
PM growth 3Y12.91%
PM growth 5Y15.82%
GM growth 3Y2.57%
GM growth 5Y1.83%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CWT is destroying value.
The number of shares outstanding for CWT has been increased compared to 1 year ago.
Compared to 5 years ago, CWT has more shares outstanding
Compared to 1 year ago, CWT has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.88, we must say that CWT is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.88, CWT is doing worse than 64.29% of the companies in the same industry.
A Debt/Equity ratio of 0.85 indicates that CWT is somewhat dependend on debt financing.
CWT's Debt to Equity ratio of 0.85 is fine compared to the rest of the industry. CWT outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.88 |
ROIC/WACC0.4
WACC8.2%
2.3 Liquidity
A Current Ratio of 0.53 indicates that CWT may have some problems paying its short term obligations.
CWT's Current ratio of 0.53 is on the low side compared to the rest of the industry. CWT is outperformed by 78.57% of its industry peers.
A Quick Ratio of 0.49 indicates that CWT may have some problems paying its short term obligations.
With a Quick ratio value of 0.49, CWT is not doing good in the industry: 78.57% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
The earnings per share for CWT have decreased by -4.00% in the last year.
CWT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.08% yearly.
Looking at the last year, CWT shows a small growth in Revenue. The Revenue has grown by 3.83% in the last year.
Measured over the past years, CWT shows a small growth in Revenue. The Revenue has been growing by 7.73% on average per year.
EPS 1Y (TTM)-4%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-71.9%
Revenue 1Y (TTM)3.83%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%-24.66%
3.2 Future
The Earnings Per Share is expected to grow by 0.68% on average over the next years.
The Revenue is expected to grow by 4.01% on average over the next years.
EPS Next Y-27.72%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue Next Year-2.62%
Revenue Next 2Y2.3%
Revenue Next 3Y3.13%
Revenue Next 5Y4.01%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.13, which indicates a rather expensive current valuation of CWT.
CWT's Price/Earnings ratio is a bit cheaper when compared to the industry. CWT is cheaper than 64.29% of the companies in the same industry.
CWT is valuated rather cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 17.84 indicates a rather expensive valuation of CWT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CWT indicates a somewhat cheap valuation: CWT is cheaper than 71.43% of the companies listed in the same industry.
CWT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.13 | ||
| Fwd PE | 17.84 |
4.2 Price Multiples
CWT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CWT is cheaper than 85.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 11.28 |
4.3 Compensation for Growth
CWT's earnings are expected to decrease with -3.60% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.95
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.59%, CWT has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.32, CWT has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.35, CWT has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.59% |
5.2 History
The dividend of CWT is nicely growing with an annual growth rate of 7.26%!
CWT has been paying a dividend for at least 10 years, so it has a reliable track record.
CWT has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.26%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
51.80% of the earnings are spent on dividend by CWT. This is a bit on the high side, but may be sustainable.
CWT's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP51.8%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
45.9
-0.39 (-0.84%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners89.24%
Inst Owner Change0%
Ins Owners0.65%
Ins Owner Change19.24%
Market Cap2.73B
Analysts86.67
Price Target58.14 (26.67%)
Short Float %1.43%
Short Ratio2.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.59% |
Yearly Dividend1.12
Dividend Growth(5Y)7.26%
DP51.8%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)93.09%
Min EPS beat(2)65.43%
Max EPS beat(2)120.74%
EPS beat(4)3
Avg EPS beat(4)62.16%
Min EPS beat(4)-2.57%
Max EPS beat(4)120.74%
EPS beat(8)4
Avg EPS beat(8)30.27%
EPS beat(12)5
Avg EPS beat(12)-965.21%
EPS beat(16)7
Avg EPS beat(16)-723.29%
Revenue beat(2)1
Avg Revenue beat(2)-2.29%
Min Revenue beat(2)-6.26%
Max Revenue beat(2)1.67%
Revenue beat(4)3
Avg Revenue beat(4)2.42%
Min Revenue beat(4)-6.26%
Max Revenue beat(4)11.85%
Revenue beat(8)5
Avg Revenue beat(8)2.28%
Revenue beat(12)6
Avg Revenue beat(12)-1.21%
Revenue beat(16)8
Avg Revenue beat(16)-2.43%
PT rev (1m)0%
PT rev (3m)0.44%
EPS NQ rev (1m)0%
EPS NQ rev (3m)3.13%
EPS NY rev (1m)0%
EPS NY rev (3m)0.54%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)3.33%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.58%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.13 | ||
| Fwd PE | 17.84 | ||
| P/S | 2.82 | ||
| P/FCF | N/A | ||
| P/OCF | 9.03 | ||
| P/B | 1.68 | ||
| P/tB | 1.72 | ||
| EV/EBITDA | 11.28 |
EPS(TTM)2.4
EY5.23%
EPS(NY)2.57
Fwd EY5.61%
FCF(TTM)-2.83
FCFYN/A
OCF(TTM)5.08
OCFY11.07%
SpS16.28
BVpS27.35
TBVpS26.73
PEG (NY)N/A
PEG (5Y)0.95
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.55% | ||
| ROE | 8.24% | ||
| ROCE | 4.41% | ||
| ROIC | 3.29% | ||
| ROICexc | 3.32% | ||
| ROICexgc | 3.34% | ||
| OM | 21.18% | ||
| PM (TTM) | 13.84% | ||
| GM | 70.34% | ||
| FCFM | N/A |
ROA(3y)2.35%
ROA(5y)2.54%
ROE(3y)7.53%
ROE(5y)8.34%
ROIC(3y)2.65%
ROIC(5y)2.93%
ROICexc(3y)2.68%
ROICexc(5y)2.97%
ROICexgc(3y)2.71%
ROICexgc(5y)3.01%
ROCE(3y)3.47%
ROCE(5y)3.91%
ROICexcg growth 3Y11.66%
ROICexcg growth 5Y6.46%
ROICexc growth 3Y11.75%
ROICexc growth 5Y6.29%
OM growth 3Y15.39%
OM growth 5Y9.23%
PM growth 3Y12.91%
PM growth 5Y15.82%
GM growth 3Y2.57%
GM growth 5Y1.83%
F-Score5
Asset Turnover0.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.05 | ||
| Cap/Depr | 343.29% | ||
| Cap/Sales | 48.57% | ||
| Interest Coverage | 3.64 | ||
| Cash Conversion | 88.36% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 0.88 |
F-Score5
WACC8.2%
ROIC/WACC0.4
Cap/Depr(3y)313.97%
Cap/Depr(5y)300.14%
Cap/Sales(3y)44.14%
Cap/Sales(5y)41.42%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-4%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-71.9%
EPS Next Y-27.72%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue 1Y (TTM)3.83%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%-24.66%
Revenue Next Year-2.62%
Revenue Next 2Y2.3%
Revenue Next 3Y3.13%
Revenue Next 5Y4.01%
EBIT growth 1Y30.55%
EBIT growth 3Y26.29%
EBIT growth 5Y17.67%
EBIT Next Year52.07%
EBIT Next 3Y24.27%
EBIT Next 5Y18.3%
FCF growth 1Y-28.79%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y43.8%
OCF growth 3Y7.87%
OCF growth 5Y11.5%