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 4 out of 10. The analysis compared the fundamentals against 14 industry peers in the Water Utilities industry. While CWT belongs to the best of the industry regarding profitability, there are concerns on its financial health. CWT is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
CWT had positive earnings in the past year.
In the past year CWT had a positive cash flow from operations.
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 Return On Assets of 3.68%. This is in the better half of the industry: CWT outperforms 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.
The Return On Invested Capital of CWT (4.25%) is better than 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 5.21%.
The 3 year average ROIC (2.65%) for CWT is below the current ROIC(4.25%), indicating increased profibility in the last year.
| 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 Profit Margin of 18.40%. This is in the lower half of the industry: CWT underperforms 64.29% of its industry peers.
CWT's Profit Margin has improved in the last couple of years.
The Operating Margin of CWT (25.17%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of CWT has grown nicely.
CWT's Gross Margin of 72.14% is fine compared to the rest of the industry. CWT outperforms 71.43% of its industry peers.
In the last couple of years the Gross Margin of CWT has grown nicely.
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CWT is destroying value.
Compared to 1 year ago, CWT has more shares outstanding
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 1.01, we must say that CWT is in the distress zone and has some risk of bankruptcy.
CWT has a Altman-Z score (1.01) which is comparable to the rest of the industry.
A Debt/Equity ratio of 0.80 indicates that CWT is somewhat dependend on debt financing.
CWT has a better Debt to Equity ratio (0.80) than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.8 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.01 |
ROIC/WACC0.53
WACC8.02%
2.3 Liquidity
CWT has a Current Ratio of 0.60. This is a bad value and indicates that CWT is not financially healthy enough and could expect problems in meeting 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 slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.80%.
CWT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.08% yearly.
The Revenue has grown by 30.48% in the past year. This is a very strong growth!
CWT shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.73% yearly.
EPS 1Y (TTM)-8.8%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-81.82%
Revenue 1Y (TTM)30.48%
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 3.56% on average over the next years.
EPS Next Y-28.22%
EPS Next 2Y-11.22%
EPS Next 3Y-4.27%
EPS Next 5Y0.68%
Revenue Next Year-2.52%
Revenue Next 2Y1.54%
Revenue Next 3Y2.15%
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
Based on the Price/Earnings ratio of 21.39, the valuation of CWT can be described as rather expensive.
CWT's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 28.22, CWT is valued a bit cheaper.
The Price/Forward Earnings ratio is 18.92, which indicates a rather expensive current valuation of CWT.
Based on the Price/Forward Earnings ratio, CWT is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 20.86. CWT is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.39 | ||
| Fwd PE | 18.92 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CWT is valued cheaply inside the industry as 92.86% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.42 |
4.3 Compensation for Growth
The decent profitability rating of CWT may justify a higher PE ratio.
CWT's earnings are expected to decrease with -4.27% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.07
EPS Next 2Y-11.22%
EPS Next 3Y-4.27%
5. Dividend
5.1 Amount
CWT has a Yearly Dividend Yield of 2.37%.
CWT's Dividend Yield is comparable with the industry average which is at 3.34.
Compared to an average S&P500 Dividend Yield of 2.44, CWT has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
5.2 History
On average, the dividend of CWT grows each year by 7.26%, which is quite nice.
CWT has paid a dividend for at least 10 years, which is 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
34.31% of the earnings are spent on dividend by CWT. This is a low number and sustainable payout ratio.
CWT's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP34.31%
EPS Next 2Y-11.22%
EPS Next 3Y-4.27%
48.77
-1.45 (-2.89%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners88.71%
Inst Owner Change0.09%
Ins Owners0.54%
Ins Owner Change18.8%
Market Cap2.91B
Analysts86.67
Price Target57.12 (17.12%)
Short Float %1.47%
Short Ratio2.16
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
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)-0.88%
PT rev (3m)-1.75%
EPS NQ rev (1m)1.67%
EPS NQ rev (3m)-4.69%
EPS NY rev (1m)-0.15%
EPS NY rev (3m)-1.11%
Revenue NQ rev (1m)10.59%
Revenue NQ rev (3m)18.37%
Revenue NY rev (1m)0.77%
Revenue NY rev (3m)0.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.39 | ||
| Fwd PE | 18.92 | ||
| P/S | 2.8 | ||
| P/FCF | N/A | ||
| P/OCF | 9.99 | ||
| P/B | 1.78 | ||
| P/tB | 1.85 | ||
| EV/EBITDA | 10.42 |
EPS(TTM)2.28
EY4.68%
EPS(NY)2.58
Fwd EY5.29%
FCF(TTM)-3.02
FCFYN/A
OCF(TTM)4.88
OCFY10.01%
SpS17.4
BVpS27.45
TBVpS26.42
PEG (NY)N/A
PEG (5Y)1.07
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
WACC8.02%
ROIC/WACC0.53
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)-8.8%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-81.82%
EPS Next Y-28.22%
EPS Next 2Y-11.22%
EPS Next 3Y-4.27%
EPS Next 5Y0.68%
Revenue 1Y (TTM)30.48%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%-24.66%
Revenue Next Year-2.52%
Revenue Next 2Y1.54%
Revenue Next 3Y2.15%
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%