AMERICAN WATER WORKS CO INC (AWK) Stock Fundamental Analysis
USA - NYSE:AWK - US0304201033 - Common Stock
144.16 USD
-1.27 (-0.87%)
144.16 USD
0 (0%)
AWK gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 15 industry peers in the Water Utilities industry. While AWK has a great profitability rating, there are quite some concerns on its financial health. AWK is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year AWK was profitable.
In the past year AWK had a positive cash flow from operations.
In the past 5 years AWK has always been profitable.
In the past 5 years AWK always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.19%, AWK is in line with its industry, outperforming 60.00% of the companies in the same industry.
AWK has a better Return On Equity (10.14%) than 86.67% of its industry peers.
AWK has a Return On Invested Capital of 4.47%. This is in the better half of the industry: AWK outperforms 73.33% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AWK is in line with the industry average of 4.85%.
The 3 year average ROIC (4.11%) for AWK is below the current ROIC(4.47%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.19% | ||
| ROE | 10.14% | ||
| ROIC | 4.47% |
ROA(3y)3.09%
ROA(5y)3.39%
ROE(3y)10.16%
ROE(5y)11.75%
ROIC(3y)4.11%
ROIC(5y)4.07%
1.3 Margins
AWK has a better Profit Margin (21.91%) than 66.67% of its industry peers.
In the last couple of years the Profit Margin of AWK has grown nicely.
AWK has a Operating Margin of 36.48%. This is in the better half of the industry: AWK outperforms 80.00% of its industry peers.
In the last couple of years the Operating Margin of AWK has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.48% | ||
| PM (TTM) | 21.91% | ||
| GM | N/A |
OM growth 3Y6.42%
OM growth 5Y1.75%
PM growth 3Y-11.29%
PM growth 5Y5.46%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AWK is destroying value.
AWK has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, AWK has more shares outstanding
The debt/assets ratio for AWK is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.06, we must say that AWK is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.06, AWK perfoms like the industry average, outperforming 53.33% of the companies in the same industry.
A Debt/Equity ratio of 1.30 is on the high side and indicates that AWK has dependencies on debt financing.
With a Debt to Equity ratio value of 1.30, AWK is not doing good in the industry: 73.33% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.06 |
ROIC/WACC0.54
WACC8.21%
2.3 Liquidity
AWK has a Current Ratio of 0.35. This is a bad value and indicates that AWK is not financially healthy enough and could expect problems in meeting its short term obligations.
AWK has a Current ratio of 0.35. This is amonst the worse of the industry: AWK underperforms 93.33% of its industry peers.
A Quick Ratio of 0.32 indicates that AWK may have some problems paying its short term obligations.
AWK has a worse Quick ratio (0.32) than 93.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.35 | ||
| Quick Ratio | 0.32 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.62% over the past year.
Measured over the past 5 years, AWK shows a small growth in Earnings Per Share. The EPS has been growing by 7.98% on average per year.
The Revenue has grown by 13.37% in the past year. This is quite good.
The Revenue has been growing slightly by 5.35% on average over the past years.
EPS 1Y (TTM)9.62%
EPS 3Y9.93%
EPS 5Y7.98%
EPS Q2Q%5.71%
Revenue 1Y (TTM)13.37%
Revenue growth 3Y6.02%
Revenue growth 5Y5.35%
Sales Q2Q%11.05%
3.2 Future
AWK is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.26% yearly.
The Revenue is expected to grow by 6.40% on average over the next years.
EPS Next Y8.88%
EPS Next 2Y7.91%
EPS Next 3Y7.41%
EPS Next 5Y7.26%
Revenue Next Year8.83%
Revenue Next 2Y7.38%
Revenue Next 3Y7.06%
Revenue Next 5Y6.4%
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 stable.
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 26.35 indicates a quite expensive valuation of AWK.
Based on the Price/Earnings ratio, AWK is valued a bit more expensive than the industry average as 60.00% of the companies are valued more cheaply.
AWK's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.77.
The Price/Forward Earnings ratio is 23.36, which indicates a rather expensive current valuation of AWK.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AWK indicates a slightly more expensive valuation: AWK is more expensive than 60.00% of the companies listed in the same industry.
AWK's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.35 | ||
| Fwd PE | 23.36 |
4.2 Price Multiples
AWK's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AWK is cheaper than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 15.65 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates AWK does not grow enough to justify the current Price/Earnings ratio.
AWK has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.97
PEG (5Y)3.3
EPS Next 2Y7.91%
EPS Next 3Y7.41%
5. Dividend
5.1 Amount
AWK has a Yearly Dividend Yield of 2.31%.
AWK's Dividend Yield is comparable with the industry average which is at 3.17.
AWK's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
5.2 History
On average, the dividend of AWK grows each year by 9.01%, which is quite nice.
AWK has paid a dividend for at least 10 years, which is a reliable track record.
AWK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.01%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
56.23% of the earnings are spent on dividend by AWK. This is a bit on the high side, but may be sustainable.
AWK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP56.23%
EPS Next 2Y7.91%
EPS Next 3Y7.41%
144.16
-1.27 (-0.87%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners95.06%
Inst Owner Change0.14%
Ins Owners0.08%
Ins Owner Change1.11%
Market Cap28.13B
Revenue(TTM)4.94B
Net Income(TTM)1.08B
Analysts55
Price Target143.49 (-0.46%)
Short Float %4.27%
Short Ratio6.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
Yearly Dividend3
Dividend Growth(5Y)9.01%
DP56.23%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.42%
Min EPS beat(2)-3.67%
Max EPS beat(2)-3.16%
EPS beat(4)1
Avg EPS beat(4)-1.34%
Min EPS beat(4)-4.7%
Max EPS beat(4)6.16%
EPS beat(8)3
Avg EPS beat(8)-0.26%
EPS beat(12)5
Avg EPS beat(12)0.5%
EPS beat(16)7
Avg EPS beat(16)-0.72%
Revenue beat(2)2
Avg Revenue beat(2)4.78%
Min Revenue beat(2)3.82%
Max Revenue beat(2)5.74%
Revenue beat(4)4
Avg Revenue beat(4)5.74%
Min Revenue beat(4)3.82%
Max Revenue beat(4)7.23%
Revenue beat(8)8
Avg Revenue beat(8)3.6%
Revenue beat(12)11
Avg Revenue beat(12)3.28%
Revenue beat(16)11
Avg Revenue beat(16)0.58%
PT rev (1m)-0.38%
PT rev (3m)-1.62%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.31%
EPS NY rev (1m)0.01%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.84%
Revenue NY rev (1m)0.1%
Revenue NY rev (3m)-0.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.35 | ||
| Fwd PE | 23.36 | ||
| P/S | 5.69 | ||
| P/FCF | N/A | ||
| P/OCF | 14.42 | ||
| P/B | 2.63 | ||
| P/tB | 2.95 | ||
| EV/EBITDA | 15.65 |
EPS(TTM)5.47
EY3.79%
EPS(NY)6.17
Fwd EY4.28%
FCF(TTM)-4.65
FCFYN/A
OCF(TTM)9.99
OCFY6.93%
SpS25.33
BVpS54.75
TBVpS48.85
PEG (NY)2.97
PEG (5Y)3.3
Graham Number82.09
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.19% | ||
| ROE | 10.14% | ||
| ROCE | 6.03% | ||
| ROIC | 4.47% | ||
| ROICexc | 4.48% | ||
| ROICexgc | 4.65% | ||
| OM | 36.48% | ||
| PM (TTM) | 21.91% | ||
| GM | N/A | ||
| FCFM | N/A |
ROA(3y)3.09%
ROA(5y)3.39%
ROE(3y)10.16%
ROE(5y)11.75%
ROIC(3y)4.11%
ROIC(5y)4.07%
ROICexc(3y)4.14%
ROICexc(5y)4.11%
ROICexgc(3y)4.32%
ROICexgc(5y)4.32%
ROCE(3y)5.41%
ROCE(5y)5.39%
ROICexgc growth 3Y4.46%
ROICexgc growth 5Y-0.91%
ROICexc growth 3Y4.79%
ROICexc growth 5Y-0.15%
OM growth 3Y6.42%
OM growth 5Y1.75%
PM growth 3Y-11.29%
PM growth 5Y5.46%
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.15
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.3 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.24 | ||
| Cap/Depr | 338.63% | ||
| Cap/Sales | 57.83% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.67% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.35 | ||
| Quick Ratio | 0.32 | ||
| Altman-Z | 1.06 |
F-Score6
WACC8.21%
ROIC/WACC0.54
Cap/Depr(3y)360.71%
Cap/Depr(5y)332.23%
Cap/Sales(3y)60.79%
Cap/Sales(5y)55.1%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)9.62%
EPS 3Y9.93%
EPS 5Y7.98%
EPS Q2Q%5.71%
EPS Next Y8.88%
EPS Next 2Y7.91%
EPS Next 3Y7.41%
EPS Next 5Y7.26%
Revenue 1Y (TTM)13.37%
Revenue growth 3Y6.02%
Revenue growth 5Y5.35%
Sales Q2Q%11.05%
Revenue Next Year8.83%
Revenue Next 2Y7.38%
Revenue Next 3Y7.06%
Revenue Next 5Y6.4%
EBIT growth 1Y16.17%
EBIT growth 3Y12.83%
EBIT growth 5Y7.19%
EBIT Next Year63.83%
EBIT Next 3Y25.59%
EBIT Next 5Y17.25%
FCF growth 1Y-9.53%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y19.93%
OCF growth 3Y12.38%
OCF growth 5Y8.14%