ESSENTIAL UTILITIES INC (WTRG) Stock Fundamental Analysis
USA - NYSE:WTRG - US29670G1022 - Common Stock
39.51 USD
-0.17 (-0.43%)
39.22 USD
-0.29 (-0.73%)
We assign a fundamental rating of 4 out of 10 to WTRG. WTRG was compared to 15 industry peers in the Water Utilities industry. While WTRG belongs to the best of the industry regarding profitability, there are concerns on its financial health. WTRG has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
WTRG had positive earnings in the past year.
In the past year WTRG had a positive cash flow from operations.
In the past 5 years WTRG has always been profitable.
WTRG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
WTRG's Return On Assets of 3.48% is fine compared to the rest of the industry. WTRG outperforms 73.33% of its industry peers.
WTRG has a Return On Equity of 9.61%. This is in the better half of the industry: WTRG outperforms 73.33% of its industry peers.
With a decent Return On Invested Capital value of 3.98%, WTRG is doing good in the industry, outperforming 66.67% of the companies in the same industry.
WTRG had an Average Return On Invested Capital over the past 3 years of 3.45%. This is in line with the industry average of 4.86%.
The 3 year average ROIC (3.45%) for WTRG is below the current ROIC(3.98%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.48% | ||
| ROE | 9.61% | ||
| ROIC | 3.98% |
ROA(3y)3.07%
ROA(5y)2.85%
ROE(3y)8.9%
ROE(5y)8.22%
ROIC(3y)3.45%
ROIC(5y)3.32%
1.3 Margins
Looking at the Profit Margin, with a value of 27.62%, WTRG belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
In the last couple of years the Profit Margin of WTRG has grown nicely.
Looking at the Operating Margin, with a value of 38.74%, WTRG belongs to the top of the industry, outperforming 93.33% of the companies in the same industry.
In the last couple of years the Operating Margin of WTRG has remained more or less at the same level.
Looking at the Gross Margin, with a value of 84.82%, WTRG belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
In the last couple of years the Gross Margin of WTRG has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.74% | ||
| PM (TTM) | 27.62% | ||
| GM | 84.82% |
OM growth 3Y4.21%
OM growth 5Y-1.02%
PM growth 3Y7.49%
PM growth 5Y2.49%
GM growth 3Y1.93%
GM growth 5YN/A
2. Health
2.1 Basic Checks
WTRG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for WTRG has been increased compared to 1 year ago.
Compared to 5 years ago, WTRG has more shares outstanding
Compared to 1 year ago, WTRG has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.01, we must say that WTRG is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.01, WTRG is in line with its industry, outperforming 53.33% of the companies in the same industry.
A Debt/Equity ratio of 1.14 is on the high side and indicates that WTRG has dependencies on debt financing.
WTRG has a worse Debt to Equity ratio (1.14) than 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.01 |
ROIC/WACC0.55
WACC7.29%
2.3 Liquidity
WTRG has a Current Ratio of 0.73. This is a bad value and indicates that WTRG is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.73, WTRG is doing worse than 66.67% of the companies in the same industry.
A Quick Ratio of 0.58 indicates that WTRG may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.58, WTRG is doing worse than 73.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.58 |
3. Growth
3.1 Past
WTRG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.80%, which is quite impressive.
The Earnings Per Share has been growing by 8.10% on average over the past years. This is quite good.
WTRG shows a small growth in Revenue. In the last year, the Revenue has grown by 1.57%.
WTRG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 18.58% yearly.
EPS 1Y (TTM)20.8%
EPS 3Y9.12%
EPS 5Y8.1%
EPS Q2Q%32%
Revenue 1Y (TTM)1.57%
Revenue growth 3Y3.56%
Revenue growth 5Y18.58%
Sales Q2Q%9.58%
3.2 Future
The Earnings Per Share is expected to grow by 4.33% on average over the next years.
The Revenue is expected to grow by 6.32% on average over the next years.
EPS Next Y-0.41%
EPS Next 2Y2.52%
EPS Next 3Y4.33%
EPS Next 5Y4.33%
Revenue Next Year7.89%
Revenue Next 2Y6.66%
Revenue Next 3Y6.63%
Revenue Next 5Y6.32%
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
The Price/Earnings ratio is 16.39, which indicates a correct valuation of WTRG.
Based on the Price/Earnings ratio, WTRG is valued a bit cheaper than 80.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.67, WTRG is valued a bit cheaper.
The Price/Forward Earnings ratio is 17.32, which indicates a rather expensive current valuation of WTRG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WTRG indicates a somewhat cheap valuation: WTRG is cheaper than 80.00% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of WTRG to the average of the S&P500 Index (31.86), we can say WTRG is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.39 | ||
| Fwd PE | 17.32 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WTRG is valued a bit cheaper than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.53 |
4.3 Compensation for Growth
The excellent profitability rating of WTRG may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.02
EPS Next 2Y2.52%
EPS Next 3Y4.33%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.38%, WTRG has a reasonable but not impressive dividend return.
WTRG's Dividend Yield is a higher than the industry average which is at 3.39.
Compared to an average S&P500 Dividend Yield of 2.40, WTRG pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.38% |
5.2 History
The dividend of WTRG has a limited annual growth rate of 5.99%.
WTRG has paid a dividend for at least 10 years, which is a reliable track record.
WTRG has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.99%
Div Incr Years33
Div Non Decr Years34
5.3 Sustainability
55.62% of the earnings are spent on dividend by WTRG. This is a bit on the high side, but may be sustainable.
The dividend of WTRG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP55.62%
EPS Next 2Y2.52%
EPS Next 3Y4.33%
39.51
-0.17 (-0.43%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners82.39%
Inst Owner Change0.94%
Ins Owners0.19%
Ins Owner Change2.91%
Market Cap11.08B
Revenue(TTM)2.09B
Net Income(TTM)645.77M
Analysts74.67
Price Target45.21 (14.43%)
Short Float %2.08%
Short Ratio3.04
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.38% |
Yearly Dividend1.26
Dividend Growth(5Y)5.99%
DP55.62%
Div Incr Years33
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)23.2%
Min EPS beat(2)21.86%
Max EPS beat(2)24.54%
EPS beat(4)3
Avg EPS beat(4)11.66%
Min EPS beat(4)-1.24%
Max EPS beat(4)24.54%
EPS beat(8)5
Avg EPS beat(8)7.37%
EPS beat(12)6
Avg EPS beat(12)5.67%
EPS beat(16)7
Avg EPS beat(16)3.51%
Revenue beat(2)2
Avg Revenue beat(2)8.75%
Min Revenue beat(2)8.05%
Max Revenue beat(2)9.45%
Revenue beat(4)3
Avg Revenue beat(4)3%
Min Revenue beat(4)-7.87%
Max Revenue beat(4)9.45%
Revenue beat(8)3
Avg Revenue beat(8)-7.09%
Revenue beat(12)6
Avg Revenue beat(12)-2.64%
Revenue beat(16)9
Avg Revenue beat(16)-0.77%
PT rev (1m)-5.13%
PT rev (3m)-2.59%
EPS NQ rev (1m)1.61%
EPS NQ rev (3m)-1.33%
EPS NY rev (1m)0.15%
EPS NY rev (3m)1%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.25%
Revenue NY rev (3m)0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.39 | ||
| Fwd PE | 17.32 | ||
| P/S | 4.74 | ||
| P/FCF | N/A | ||
| P/OCF | 12.1 | ||
| P/B | 1.65 | ||
| P/tB | 2.53 | ||
| EV/EBITDA | 14.53 |
EPS(TTM)2.41
EY6.1%
EPS(NY)2.28
Fwd EY5.77%
FCF(TTM)-1.7
FCFYN/A
OCF(TTM)3.27
OCFY8.26%
SpS8.34
BVpS23.96
TBVpS15.6
PEG (NY)N/A
PEG (5Y)2.02
Graham Number36.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.48% | ||
| ROE | 9.61% | ||
| ROCE | 5.05% | ||
| ROIC | 3.98% | ||
| ROICexc | 3.99% | ||
| ROICexgc | 4.59% | ||
| OM | 38.74% | ||
| PM (TTM) | 27.62% | ||
| GM | 84.82% | ||
| FCFM | N/A |
ROA(3y)3.07%
ROA(5y)2.85%
ROE(3y)8.9%
ROE(5y)8.22%
ROIC(3y)3.45%
ROIC(5y)3.32%
ROICexc(3y)3.45%
ROICexc(5y)3.32%
ROICexgc(3y)4.04%
ROICexgc(5y)3.94%
ROCE(3y)4.42%
ROCE(5y)4.24%
ROICexgc growth 3Y-0.42%
ROICexgc growth 5Y1.31%
ROICexc growth 3Y0.8%
ROICexc growth 5Y-1.43%
OM growth 3Y4.21%
OM growth 5Y-1.02%
PM growth 3Y7.49%
PM growth 5Y2.49%
GM growth 3Y1.93%
GM growth 5YN/A
F-Score6
Asset Turnover0.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.14 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.89 | ||
| Cap/Depr | 355.49% | ||
| Cap/Sales | 59.6% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.56% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.73 | ||
| Quick Ratio | 0.58 | ||
| Altman-Z | 1.01 |
F-Score6
WACC7.29%
ROIC/WACC0.55
Cap/Depr(3y)346.54%
Cap/Depr(5y)341.43%
Cap/Sales(3y)56.19%
Cap/Sales(5y)56.01%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)20.8%
EPS 3Y9.12%
EPS 5Y8.1%
EPS Q2Q%32%
EPS Next Y-0.41%
EPS Next 2Y2.52%
EPS Next 3Y4.33%
EPS Next 5Y4.33%
Revenue 1Y (TTM)1.57%
Revenue growth 3Y3.56%
Revenue growth 5Y18.58%
Sales Q2Q%9.58%
Revenue Next Year7.89%
Revenue Next 2Y6.66%
Revenue Next 3Y6.63%
Revenue Next 5Y6.32%
EBIT growth 1Y31.8%
EBIT growth 3Y7.93%
EBIT growth 5Y17.37%
EBIT Next Year58.93%
EBIT Next 3Y23.72%
EBIT Next 5Y18.08%
FCF growth 1Y-25.63%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y13.7%
OCF growth 3Y6.12%
OCF growth 5Y17.88%
ESSENTIAL UTILITIES INC / WTRG FAQ
Can you provide the ChartMill fundamental rating for ESSENTIAL UTILITIES INC?
ChartMill assigns a fundamental rating of 4 / 10 to WTRG.
What is the valuation status of ESSENTIAL UTILITIES INC (WTRG) stock?
ChartMill assigns a valuation rating of 4 / 10 to ESSENTIAL UTILITIES INC (WTRG). This can be considered as Fairly Valued.
Can you provide the profitability details for ESSENTIAL UTILITIES INC?
ESSENTIAL UTILITIES INC (WTRG) has a profitability rating of 8 / 10.
What are the PE and PB ratios of ESSENTIAL UTILITIES INC (WTRG) stock?
The Price/Earnings (PE) ratio for ESSENTIAL UTILITIES INC (WTRG) is 16.39 and the Price/Book (PB) ratio is 1.65.
How financially healthy is ESSENTIAL UTILITIES INC?
The financial health rating of ESSENTIAL UTILITIES INC (WTRG) is 0 / 10.