CALIFORNIA WATER SERVICE GRP (CWT) Stock Fundamental Analysis
NYSE:CWT - New York Stock Exchange, Inc. - US1307881029 - Common Stock - Currency: USD
Taking everything into account, CWT scores 3 out of 10 in our fundamental rating. CWT was compared to 14 industry peers in the Water Utilities industry. While CWT is still in line with the averages on profitability rating, there are concerns on its financial health. CWT has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
CWT had positive earnings in the past year.
CWT had a positive operating cash flow in the past year.
Of the past 5 years CWT 4 years were profitable.
Of the past 5 years CWT 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of CWT (4.01%) is better than 71.43% of its industry peers.
CWT has a better Return On Equity (12.36%) than 71.43% of its industry peers.
The Return On Invested Capital of CWT (3.57%) is comparable to the rest of the industry.
CWT had an Average Return On Invested Capital over the past 3 years of 2.23%. This is below the industry average of 5.69%.
The last Return On Invested Capital (3.57%) for CWT is above the 3 year average (2.23%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.01% | ||
| ROE | 12.36% | ||
| ROIC | 3.57% |
ROA(3y)2.06%
ROA(5y)2.21%
ROE(3y)6.5%
ROE(5y)7.62%
ROIC(3y)2.23%
ROIC(5y)2.7%
1.3 Margins
The Profit Margin of CWT (19.56%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of CWT has declined.
The Operating Margin of CWT (20.68%) is worse than 64.29% of its industry peers.
CWT's Operating Margin has declined in the last couple of years.
CWT's Gross Margin of 72.00% is fine compared to the rest of the industry. CWT outperforms 78.57% of its industry peers.
In the last couple of years the Gross Margin of CWT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.68% | ||
| PM (TTM) | 19.56% | ||
| GM | 72% |
OM growth 3Y-25.22%
OM growth 5Y-15.86%
PM growth 3Y-18.77%
PM growth 5Y-7.01%
GM growth 3Y-0.33%
GM growth 5Y0.06%
2. Health
2.1 Basic Checks
CWT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
There is no outstanding debt for CWT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
Based on the Altman-Z score of 0.96, we must say that CWT is in the distress zone and has some risk of bankruptcy.
CWT has a Altman-Z score (0.96) which is comparable to the rest of the industry.
A Debt/Equity ratio of 0.81 indicates that CWT is somewhat dependend on debt financing.
CWT has a Debt to Equity ratio of 0.81. This is in the better half of the industry: CWT outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.96 |
ROIC/WACC0.47
WACC7.66%
2.3 Liquidity
CWT has a Current Ratio of 0.64. This is a bad value and indicates that CWT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.64, CWT is doing worse than 78.57% of the companies in the same industry.
A Quick Ratio of 0.60 indicates that CWT may have some problems paying its short term obligations.
With a Quick ratio value of 0.60, CWT is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.6 |
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.
Measured over the past years, CWT shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.08% on average per year.
EPS 1Y (TTM)267.42%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-36.54%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%3.58%
3.2 Future
CWT is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -1.08% yearly.
The Revenue is expected to grow by 2.97% on average over the next years.
EPS Next Y-27.66%
EPS Next 2Y-11.86%
EPS Next 3Y-3.6%
EPS Next 5Y-1.08%
Revenue Next Year-3.1%
Revenue Next 2Y0.34%
Revenue Next 3Y2.15%
Revenue Next 5Y2.97%
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.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 14.15, the valuation of CWT can be described as correct.
Based on the Price/Earnings ratio, CWT is valued cheaply inside the industry as 92.86% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of CWT to the average of the S&P500 Index (29.75), we can say CWT is valued rather cheaply.
CWT is valuated rather expensively with a Price/Forward Earnings ratio of 19.56.
Based on the Price/Forward Earnings ratio, CWT is valued a bit cheaper than 64.29% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.44. CWT is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.15 | ||
| Fwd PE | 19.56 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CWT is valued a bit cheaper than the industry average as 78.57% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.7 |
4.3 Compensation for Growth
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)0.7
EPS Next 2Y-11.86%
EPS Next 3Y-3.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.64%, CWT has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.42, CWT has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.30, CWT has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.64% |
5.2 History
The dividend of CWT is nicely growing with an annual growth rate of 6.82%!
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)6.82%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
CWT pays out 31.70% of its income as dividend. This is a sustainable payout ratio.
DP31.7%
EPS Next 2Y-11.86%
EPS Next 3Y-3.6%
46.27
+0.82 (+1.8%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners88.71%
Inst Owner Change1.77%
Ins Owners0.54%
Ins Owner Change-0.89%
Market Cap2.75B
Analysts84.44
Price Target57.12 (23.45%)
Short Float %1.3%
Short Ratio2.13
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.64% |
Yearly Dividend1.04
Dividend Growth(5Y)6.82%
DP31.7%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)31.22%
Min EPS beat(2)-2.57%
Max EPS beat(2)65.02%
EPS beat(4)2
Avg EPS beat(4)36.13%
Min EPS beat(4)-58.48%
Max EPS beat(4)140.57%
EPS beat(8)3
Avg EPS beat(8)-1465.55%
EPS beat(12)3
Avg EPS beat(12)-989.11%
EPS beat(16)5
Avg EPS beat(16)-752.34%
Revenue beat(2)2
Avg Revenue beat(2)7.14%
Min Revenue beat(2)2.43%
Max Revenue beat(2)11.85%
Revenue beat(4)3
Avg Revenue beat(4)9.43%
Min Revenue beat(4)-22.37%
Max Revenue beat(4)45.81%
Revenue beat(8)4
Avg Revenue beat(8)-0.83%
Revenue beat(12)6
Avg Revenue beat(12)-1.22%
Revenue beat(16)9
Avg Revenue beat(16)5.24%
PT rev (1m)0%
PT rev (3m)-3.45%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-48.7%
EPS NY rev (1m)0%
EPS NY rev (3m)-4.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-6.29%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.15 | ||
| Fwd PE | 19.56 | ||
| P/S | 2.67 | ||
| P/FCF | N/A | ||
| P/OCF | 9.26 | ||
| P/B | 1.69 | ||
| P/tB | 1.73 | ||
| EV/EBITDA | 10.7 |
EPS(TTM)3.27
EY7.07%
EPS(NY)2.37
Fwd EY5.11%
FCF(TTM)-2.43
FCFYN/A
OCF(TTM)5
OCFY10.8%
SpS17.3
BVpS27.39
TBVpS26.76
PEG (NY)N/A
PEG (5Y)0.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.01% | ||
| ROE | 12.36% | ||
| ROCE | 4.79% | ||
| ROIC | 3.57% | ||
| ROICexc | 3.62% | ||
| ROICexgc | 3.65% | ||
| OM | 20.68% | ||
| PM (TTM) | 19.56% | ||
| GM | 72% | ||
| FCFM | N/A |
ROA(3y)2.06%
ROA(5y)2.21%
ROE(3y)6.5%
ROE(5y)7.62%
ROIC(3y)2.23%
ROIC(5y)2.7%
ROICexc(3y)2.27%
ROICexc(5y)2.74%
ROICexgc(3y)2.3%
ROICexgc(5y)2.78%
ROCE(3y)2.88%
ROCE(5y)3.62%
ROICexcg growth 3Y-32.76%
ROICexcg growth 5Y-22.22%
ROICexc growth 3Y-32.75%
ROICexc growth 5Y-22.34%
OM growth 3Y-25.22%
OM growth 5Y-15.86%
PM growth 3Y-18.77%
PM growth 5Y-7.01%
GM growth 3Y-0.33%
GM growth 5Y0.06%
F-Score7
Asset Turnover0.21
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.8 | ||
| Cap/Depr | 333.34% | ||
| Cap/Sales | 42.93% | ||
| Interest Coverage | 3.85 | ||
| Cash Conversion | 86.02% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.6 | ||
| Altman-Z | 0.96 |
F-Score7
WACC7.66%
ROIC/WACC0.47
Cap/Depr(3y)284.57%
Cap/Depr(5y)289.93%
Cap/Sales(3y)41.36%
Cap/Sales(5y)40%
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-27.66%
EPS Next 2Y-11.86%
EPS Next 3Y-3.6%
EPS Next 5Y-1.08%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%3.58%
Revenue Next Year-3.1%
Revenue Next 2Y0.34%
Revenue Next 3Y2.15%
Revenue Next 5Y2.97%
EBIT growth 1Y197.92%
EBIT growth 3Y-25.21%
EBIT growth 5Y-13.66%
EBIT Next Year124.3%
EBIT Next 3Y33.85%
EBIT Next 5Y24.16%
FCF growth 1Y-162.44%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y17.71%
OCF growth 3Y22.7%
OCF growth 5Y4%