CALIFORNIA WATER SERVICE GRP (CWT) Stock Fundamental Analysis
NYSE:CWT - New York Stock Exchange, Inc. - US1307881029 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to CWT. CWT was compared to 14 industry peers in the Water Utilities industry. CWT has a medium profitability rating, but doesn't score so well on its financial health evaluation. CWT is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year CWT was profitable.
CWT had a positive operating cash flow in the past year.
CWT had positive earnings in each of the past 5 years.
Each year in the past 5 years CWT had a positive operating cash flow.
1.2 Ratios
CWT has a Return On Assets of 2.55%. This is in the lower half of the industry: CWT underperforms 64.29% of its industry peers.
With a Return On Equity value of 8.24%, CWT is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
Looking at the Return On Invested Capital, with a value of 3.29%, CWT is in line with its industry, outperforming 42.86% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CWT is below the industry average of 5.09%.
The last Return On Invested Capital (3.29%) for CWT is above the 3 year average (2.65%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.55% | ||
| ROE | 8.24% | ||
| ROIC | 3.29% |
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
The Profit Margin of CWT (13.84%) is worse than 64.29% of its industry peers.
In the last couple of years the Profit Margin of CWT has grown nicely.
CWT's Operating Margin of 21.18% is on the low side compared to the rest of the industry. CWT is outperformed by 64.29% of its industry peers.
In the last couple of years the Operating Margin of CWT has grown nicely.
The Gross Margin of CWT (70.34%) is better than 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 | 21.18% | ||
| PM (TTM) | 13.84% | ||
| GM | 70.34% |
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
CWT has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.89, we must say that CWT is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of CWT (0.89) is worse than 64.29% of its industry peers.
CWT has a Debt/Equity ratio of 0.85. This is a neutral value indicating CWT is somewhat dependend on debt financing.
CWT's Debt to Equity ratio of 0.85 is fine compared to the rest of the industry. CWT outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.89 |
ROIC/WACC0.4
WACC8.16%
2.3 Liquidity
CWT has a Current Ratio of 0.53. This is a bad value and indicates that CWT is not financially healthy enough and could expect problems in meeting its short term obligations.
CWT has a Current ratio of 0.53. This is in the lower half of the industry: CWT underperforms 78.57% of its industry peers.
CWT has a Quick Ratio of 0.53. This is a bad value and indicates that CWT is not financially healthy enough and could expect problems in meeting its short term obligations.
CWT has a worse Quick ratio (0.49) than 78.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
The earnings per share for CWT have decreased by -4.00% in the last year.
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.
The Revenue has been growing slightly by 3.83% in the past year.
The Revenue has been growing slightly by 7.73% on average over the past years.
EPS 1Y (TTM)-4%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-71.9%
Revenue 1Y (TTM)3.83%
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-27.72%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue Next Year-2.62%
Revenue Next 2Y2.3%
Revenue Next 3Y3.13%
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
A Price/Earnings ratio of 19.59 indicates a rather expensive valuation of CWT.
Compared to the rest of the industry, the Price/Earnings ratio of CWT indicates a somewhat cheap valuation: CWT is cheaper than 64.29% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of CWT to the average of the S&P500 Index (25.82), we can say CWT is valued slightly cheaper.
A Price/Forward Earnings ratio of 18.27 indicates a rather expensive valuation of CWT.
Based on the Price/Forward Earnings ratio, CWT is valued a bit cheaper than 64.29% of the companies in the same industry.
CWT is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.59 | ||
| Fwd PE | 18.27 |
4.2 Price Multiples
CWT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. CWT is cheaper than 85.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 11.46 |
4.3 Compensation for Growth
CWT's earnings are expected to decrease with -3.60% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.98
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
5. Dividend
5.1 Amount
CWT has a Yearly Dividend Yield of 2.60%.
Compared to an average industry Dividend Yield of 3.40, CWT has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.36, CWT has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.6% |
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
51.80% of the earnings are spent on dividend by CWT. This is a bit on the high side, but may be sustainable.
The dividend of CWT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP51.8%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
47.02
+0.13 (+0.28%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryWater Utilities
Earnings (Last)
Earnings (Next)
Inst Owners88.71%
Inst Owner Change3.05%
Ins Owners0.54%
Ins Owner Change18.8%
Market Cap2.80B
Analysts86.67
Price Target58.14 (23.65%)
Short Float %1.35%
Short Ratio2.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.6% |
Yearly Dividend1.12
Dividend Growth(5Y)7.26%
DP51.8%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)93.09%
Min EPS beat(2)65.43%
Max EPS beat(2)120.74%
EPS beat(4)3
Avg EPS beat(4)62.16%
Min EPS beat(4)-2.57%
Max EPS beat(4)120.74%
EPS beat(8)4
Avg EPS beat(8)30.27%
EPS beat(12)5
Avg EPS beat(12)-965.21%
EPS beat(16)7
Avg EPS beat(16)-723.29%
Revenue beat(2)1
Avg Revenue beat(2)-2.29%
Min Revenue beat(2)-6.26%
Max Revenue beat(2)1.67%
Revenue beat(4)3
Avg Revenue beat(4)2.42%
Min Revenue beat(4)-6.26%
Max Revenue beat(4)11.85%
Revenue beat(8)5
Avg Revenue beat(8)2.28%
Revenue beat(12)6
Avg Revenue beat(12)-1.21%
Revenue beat(16)8
Avg Revenue beat(16)-2.43%
PT rev (1m)0.44%
PT rev (3m)1.79%
EPS NQ rev (1m)3.13%
EPS NQ rev (3m)-1.28%
EPS NY rev (1m)0.69%
EPS NY rev (3m)-0.09%
Revenue NQ rev (1m)3.33%
Revenue NQ rev (3m)7.25%
Revenue NY rev (1m)0.58%
Revenue NY rev (3m)0.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.59 | ||
| Fwd PE | 18.27 | ||
| P/S | 2.89 | ||
| P/FCF | N/A | ||
| P/OCF | 9.25 | ||
| P/B | 1.72 | ||
| P/tB | 1.76 | ||
| EV/EBITDA | 11.46 |
EPS(TTM)2.4
EY5.1%
EPS(NY)2.57
Fwd EY5.47%
FCF(TTM)-2.83
FCFYN/A
OCF(TTM)5.08
OCFY10.81%
SpS16.28
BVpS27.35
TBVpS26.73
PEG (NY)N/A
PEG (5Y)0.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.55% | ||
| ROE | 8.24% | ||
| ROCE | 4.41% | ||
| ROIC | 3.29% | ||
| ROICexc | 3.32% | ||
| ROICexgc | 3.34% | ||
| OM | 21.18% | ||
| PM (TTM) | 13.84% | ||
| GM | 70.34% | ||
| 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-Score5
Asset Turnover0.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 4.05 | ||
| Cap/Depr | 343.29% | ||
| Cap/Sales | 48.57% | ||
| Interest Coverage | 3.64 | ||
| Cash Conversion | 88.36% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.53 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 0.89 |
F-Score5
WACC8.16%
ROIC/WACC0.4
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)-4%
EPS 3Y18.6%
EPS 5Y20.08%
EPS Q2Q%-71.9%
EPS Next Y-27.72%
EPS Next 2Y-11.3%
EPS Next 3Y-3.6%
EPS Next 5Y0.68%
Revenue 1Y (TTM)3.83%
Revenue growth 3Y9.44%
Revenue growth 5Y7.73%
Sales Q2Q%-24.66%
Revenue Next Year-2.62%
Revenue Next 2Y2.3%
Revenue Next 3Y3.13%
Revenue Next 5Y3.56%
EBIT growth 1Y30.55%
EBIT growth 3Y26.29%
EBIT growth 5Y17.67%
EBIT Next Year45.29%
EBIT Next 3Y24.27%
EBIT Next 5Y18.48%
FCF growth 1Y-28.79%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y43.8%
OCF growth 3Y7.87%
OCF growth 5Y11.5%