CALIFORNIA WATER SERVICE GRP (CWT) Stock Fundamental Analysis
NYSE:CWT - New York Stock Exchange, Inc. - US1307881029 - Common Stock - Currency: USD
Overall CWT gets a fundamental rating of 4 out of 10. We evaluated CWT against 14 industry peers in the Water Utilities industry. CWT scores excellent on profitability, but there are concerns on its financial health. CWT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year CWT was profitable.
CWT had a positive operating cash flow in the past year.
In the past 5 years CWT has always been profitable.
Each year in the past 5 years CWT had a positive operating cash flow.
1.2 Ratios
CWT has a better Return On Assets (3.68%) than 71.43% of its industry peers.
With a decent Return On Equity value of 11.67%, CWT is doing good in the industry, outperforming 71.43% of the companies in the same industry.
CWT's Return On Invested Capital of 4.25% is fine compared to the rest of the industry. CWT outperforms 64.29% of its industry peers.
The Average Return On Invested Capital over the past 3 years for CWT is below the industry average of 5.27%.
The last Return On Invested Capital (4.25%) for CWT is above the 3 year average (2.65%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.68% | ||
| ROE | 11.67% | ||
| ROIC | 4.25% |
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
CWT has a worse Profit Margin (18.40%) than 64.29% of its industry peers.
CWT's Profit Margin has improved in the last couple of years.
With a Operating Margin value of 25.17%, CWT perfoms like the industry average, outperforming 42.86% of the companies in the same industry.
In the last couple of years the Operating Margin of CWT has grown nicely.
Looking at the Gross Margin, with a value of 72.14%, CWT is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
CWT's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.17% | ||
| PM (TTM) | 18.4% | ||
| GM | 72.14% |
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.
The number of shares outstanding for CWT has been increased compared to 5 years ago.
Compared to 1 year ago, CWT has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.01, we must say that CWT is in the distress zone and has some risk of bankruptcy.
CWT's Altman-Z score of 1.01 is in line compared to the rest of the industry. CWT outperforms 50.00% of its industry peers.
A Debt/Equity ratio of 0.80 indicates that CWT is somewhat dependend on debt financing.
CWT's Debt to Equity ratio of 0.80 is fine compared to the rest of the industry. CWT outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.01 |
ROIC/WACC0.52
WACC8.15%
2.3 Liquidity
A Current Ratio of 0.60 indicates that CWT may have some problems paying its short term obligations.
The Current ratio of CWT (0.60) is worse than 71.43% of its industry peers.
A Quick Ratio of 0.56 indicates that CWT may have some problems paying its short term obligations.
CWT has a Quick ratio of 0.56. This is in the lower half of the industry: CWT underperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
CWT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 267.42%, which is quite impressive.
The Earnings Per Share has been growing by 20.08% on average over the past years. This is a very strong growth
CWT shows a strong growth in Revenue. In the last year, the Revenue has grown by 30.48%.
The Revenue has been growing slightly by 7.73% on average over the past years.
EPS 1Y (TTM)267.42%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-36.54%
Revenue 1Y (TTM)30.48%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%3.58%
3.2 Future
CWT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 0.68% yearly.
CWT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.56% yearly.
EPS Next Y-28.11%
EPS Next 2Y-11.43%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue Next Year-3.18%
Revenue Next 2Y0.77%
Revenue Next 3Y2.24%
Revenue Next 5Y3.56%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
With a Price/Earnings ratio of 15.56, CWT is valued correctly.
Based on the Price/Earnings ratio, CWT is valued cheaper than 92.86% of the companies in the same industry.
When comparing the Price/Earnings ratio of CWT to the average of the S&P500 Index (28.29), we can say CWT is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 21.65, the valuation of CWT can be described as rather expensive.
71.43% of the companies in the same industry are more expensive than CWT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.08, CWT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.56 | ||
| Fwd PE | 21.65 |
4.2 Price Multiples
CWT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CWT is cheaper than 92.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.51 |
4.3 Compensation for Growth
CWT has a very decent profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as CWT's earnings are expected to decrease with -3.60% in the coming years.
PEG (NY)N/A
PEG (5Y)0.78
EPS Next 2Y-11.43%
EPS Next 3Y-3.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.47%, CWT has a reasonable but not impressive dividend return.
CWT's Dividend Yield is comparable with the industry average which is at 3.45.
CWT's Dividend Yield is comparable with the S&P500 average which is at 2.57.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
5.2 History
The dividend of CWT is nicely growing with an annual growth rate of 7.26%!
CWT has paid a dividend for at least 10 years, which is a reliable track record.
CWT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.26%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
CWT pays out 34.31% of its income as dividend. This is a sustainable payout ratio.
The dividend of CWT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP34.31%
EPS Next 2Y-11.43%
EPS Next 3Y-3.6%
50.89
+0.67 (+1.33%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners88.71%
Inst Owner Change0%
Ins Owners0.54%
Ins Owner Change18.8%
Market Cap3.03B
Analysts84.44
Price Target57.89 (13.76%)
Short Float %1.39%
Short Ratio2.24
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
Yearly Dividend1.12
Dividend Growth(5Y)7.26%
DP34.31%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)31.43%
Min EPS beat(2)-2.57%
Max EPS beat(2)65.43%
EPS beat(4)3
Avg EPS beat(4)67.11%
Min EPS beat(4)-2.57%
Max EPS beat(4)140.57%
EPS beat(8)3
Avg EPS beat(8)-1458.96%
EPS beat(12)4
Avg EPS beat(12)-978.65%
EPS beat(16)6
Avg EPS beat(16)-745.8%
Revenue beat(2)2
Avg Revenue beat(2)2.05%
Min Revenue beat(2)1.67%
Max Revenue beat(2)2.43%
Revenue beat(4)4
Avg Revenue beat(4)15.44%
Min Revenue beat(4)1.67%
Max Revenue beat(4)45.81%
Revenue beat(8)5
Avg Revenue beat(8)-0.62%
Revenue beat(12)7
Avg Revenue beat(12)-0.01%
Revenue beat(16)9
Avg Revenue beat(16)4.83%
PT rev (1m)0.44%
PT rev (3m)-0.44%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.25%
EPS NY rev (1m)-0.62%
EPS NY rev (3m)-0.96%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)7.03%
Revenue NY rev (1m)0.1%
Revenue NY rev (3m)-0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.56 | ||
| Fwd PE | 21.65 | ||
| P/S | 2.92 | ||
| P/FCF | N/A | ||
| P/OCF | 10.41 | ||
| P/B | 1.85 | ||
| P/tB | 1.92 | ||
| EV/EBITDA | 10.51 |
EPS(TTM)3.27
EY6.43%
EPS(NY)2.35
Fwd EY4.62%
FCF(TTM)-3.02
FCFYN/A
OCF(TTM)4.89
OCFY9.61%
SpS17.43
BVpS27.49
TBVpS26.46
PEG (NY)N/A
PEG (5Y)0.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.68% | ||
| ROE | 11.67% | ||
| ROCE | 5.62% | ||
| ROIC | 4.25% | ||
| ROICexc | 4.3% | ||
| ROICexgc | 4.35% | ||
| OM | 25.17% | ||
| PM (TTM) | 18.4% | ||
| GM | 72.14% | ||
| 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-Score7
Asset Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.31 | ||
| Cap/Depr | 350.98% | ||
| Cap/Sales | 45.41% | ||
| Interest Coverage | 4.69 | ||
| Cash Conversion | 73.61% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 1.01 |
F-Score7
WACC8.15%
ROIC/WACC0.52
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)267.42%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-36.54%
EPS Next Y-28.11%
EPS Next 2Y-11.43%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue 1Y (TTM)30.48%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%3.58%
Revenue Next Year-3.18%
Revenue Next 2Y0.77%
Revenue Next 3Y2.24%
Revenue Next 5Y3.56%
EBIT growth 1Y321.32%
EBIT growth 3Y26.29%
EBIT growth 5Y17.67%
EBIT Next Year45.29%
EBIT Next 3Y24.27%
EBIT Next 5Y18.48%
FCF growth 1Y-8.44%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y33.54%
OCF growth 3Y7.87%
OCF growth 5Y11.5%