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American States Water (AWR)
NYSE:AWR
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American States Water (AWR) AI Stock Analysis

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AWR

American States Water

(NYSE:AWR)

Rating:66Neutral
Price Target:
$82.00
â–²(9.95% Upside)
American States Water's overall score is driven by strong earnings call performance and solid financials, despite concerns over cash flow and rising debt. The lack of technical analysis data and moderate valuation also influence the score.
Positive Factors
Earnings
Q4/FY’24 EPS were above the prior-year quarter’s results of $0.55, showcasing positive earnings growth.
ESG Investments
ESG flow dynamics could support water stocks, including AWR, as traditional ESG favorites pivot strategies.
Regulatory Approvals
AWR received final approval for its California general rate case settlement, which is a positive regulatory outcome.
Negative Factors
Analyst Recommendation
Analyst maintains Underperform on valuation and peer premium.
Market Outlook
Limited events that drive analyst EPS forecast outlook higher in the coming 12 months.
Valuation
AWR trades at a premium to water peers (11%) and to the broader electric and gas utility group (32%), making it one of the highest-premium utilities under analyst coverage.

American States Water (AWR) vs. SPDR S&P 500 ETF (SPY)

American States Water Business Overview & Revenue Model

Company DescriptionAmerican States Water Company, through its subsidiaries, provides water and electric services to residential, commercial, industrial, and other customers in the United States. It operates through three segments: Water, Electric, and Contracted Services. The company purchases, produces, distributes, and sells water, as well as distributes electricity. As of December 31, 2021, American States Water Company provided water service to 262,770 customers located throughout 10 counties in the State of California; and distributed electricity to 24,656 customers in San Bernardino County mountain communities in California. The company also provides water and/or wastewater services, including the operation, maintenance, and construction of facilities at the water and/or wastewater systems at various military installations. American States Water Company was incorporated in 1929 and is based in San Dimas, California.
How the Company Makes MoneyAmerican States Water generates revenue primarily through the provision of water and electric utility services. Its core revenue stream comes from water sales to residential, commercial, and industrial customers, which is regulated by state public utility commissions. The company sets rates based on the cost of service, including investments in infrastructure, maintenance, and operational expenses. Additionally, AWR earns revenue from electric utility services, where it charges customers based on electricity consumption. The company also benefits from various partnerships and regulatory frameworks that allow for stable revenue generation, including infrastructure projects that may receive governmental support or funding. Furthermore, AWR may engage in capital investments that lead to rate base increases, further enhancing its revenue potential.

American States Water Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q2-2025)
|
% Change Since: 0.96%|
Next Earnings Date:Feb 25, 2026
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with increased earnings per share, revenue growth, strong credit ratings, and a significant dividend increase. However, there were concerns about decreased earnings from ASUS and potential revenue volatility due to regulatory changes.
Q2-2025 Updates
Positive Updates
Increased Earnings Per Share
Earnings per share were $0.02 higher compared to the same quarter in 2024, attributed to the receipt of final decisions from the California Public Utilities Commission for water and electric general rate cases.
Dividend Increase
The Board approved a substantial dividend increase of 8.3%, reflecting confidence in the company's ability to achieve long-term sustainable earnings growth.
Revenue Growth
Consolidated revenue for the second quarter increased by $7.7 million compared to the same period of 2024, with the water segment seeing an increase of $9.3 million.
Strong Credit Ratings
Standard & Poor's Global Ratings affirmed a credit rating of A stable for American States Water and A+ stable for Golden State Water, some of the highest in the U.S. investor-owned water utility industry.
Infrastructure Investment
Regulated utilities are on pace to invest $170 million to $210 million in infrastructure investments this year.
Negative Updates
Decreased Earnings from ASUS
Earnings for ASUS decreased by $0.06 per share due mostly to timing differences of construction activities.
Potential Revenue Volatility
Without the continuation of a full revenue decoupling mechanism and a full cost balancing account for water supply, the company may be subject to future volatility in revenues and earnings.
Company Guidance
During the American States Water Company's second-quarter 2025 call, the company provided various metrics and guidance. Earnings per share (EPS) increased by $0.02 from the same period last year, reaching $0.87. The increase was driven by new water rates authorized by the California Public Utilities Commission (CPUC) for 2025-2027 and electric rates for 2023-2026, though partially offset by a $0.06 per share decrease in ASUS earnings due to construction timing differences. ASUS is expected to contribute $0.59 to $0.63 per share for the year. The company announced an 8.3% dividend increase, reflecting confidence in long-term growth. Year-to-date earnings were $1.57 per share, a $0.10 increase from the previous year. The company also highlighted its infrastructure investment plans, targeting $170 million to $210 million for the year. Additionally, American States Water is involved in legislative efforts for revenue decoupling in California, which is progressing but remains uncertain.

American States Water Financial Statement Overview

Summary
American States Water demonstrates solid revenue growth and profitability metrics, indicating a well-performing core business. The balance sheet reflects moderate leverage but maintains a stable equity base. However, cash flow management appears to be a challenge with negative free cash flow, suggesting a need for strategic investment planning.
Income Statement
78
Positive
American States Water demonstrates consistent revenue growth over the years, with a moderate increase of 2.14% in TTM (Trailing-Twelve-Months). The company maintains strong profitability margins with a gross profit margin at 69.35% and net profit margin at 20.22% for the TTM. The EBIT margin is also solid at 31.41%, however, the EBITDA margin shows a slight decrease but remains robust at 39.79%. Although growth is steady, the margins indicate a well-managed cost structure, aligning with industry standards.
Balance Sheet
64
Positive
The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.99, indicating moderate leverage. The return on equity (ROE) stands at 12.86% for the TTM, which is healthy but shows room for improvement. The equity ratio is 37.57%, suggesting a balanced approach to financing with equity. While solvency is adequate, high debt levels could pose potential risks if revenue growth stalls.
Cash Flow
55
Neutral
Operating cash flow to net income ratio is favorable at 1.61, signifying efficient cash generation from operations. However, the free cash flow is negative at -$53.99 million, raising concerns about the company's ability to fund investments without external financing. The free cash flow to net income ratio is negative, highlighting challenges in covering capital expenditures from operations. The cash flow situation indicates a need for careful management of capital expenditures to avoid cash constraints.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue615.96M595.46M595.70M491.53M498.85M488.24M
Gross Profit423.14M452.02M449.55M368.23M377.82M368.84M
EBITDA250.69M244.05M252.54M170.78M185.06M171.04M
Net Income124.67M119.27M124.92M78.40M94.35M86.42M
Balance Sheet
Total Assets2.61B2.50B2.25B2.03B1.90B1.79B
Cash, Cash Equivalents and Short-Term Investments20.25M26.66M14.07M6.00M4.96M36.74M
Total Debt950.50M938.24M917.88M734.43M629.02M586.55M
Total Liabilities1.64B1.58B1.47B878.28M802.86M709.58M
Stockholders Equity972.52M920.05M776.11M1.16B1.10B1.08B
Cash Flow
Free Cash Flow-3.29M-33.23M-120.86M-48.44M-28.93M-8.25M
Operating Cash Flow237.85M198.73M67.68M117.80M115.58M122.17M
Investing Cash Flow-242.22M-232.78M-188.76M-167.10M-145.09M-131.61M
Financing Cash Flow21.03M46.64M129.16M50.34M-2.27M44.84M

American States Water Technical Analysis

Technical Analysis Sentiment
Negative
Last Price74.58
Price Trends
50DMA
75.52
Negative
100DMA
76.68
Negative
200DMA
76.87
Negative
Market Momentum
MACD
-0.06
Negative
RSI
48.06
Neutral
STOCH
34.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AWR, the sentiment is Negative. The current price of 74.58 is above the 20-day moving average (MA) of 74.34, below the 50-day MA of 75.52, and below the 200-day MA of 76.87, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 48.06 is Neutral, neither overbought nor oversold. The STOCH value of 34.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AWR.

American States Water Risk Analysis

American States Water disclosed 48 risk factors in its most recent earnings report. American States Water reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Delays in obtaining approval of general rate cases could adversely impact our liquidity Q4, 2023

American States Water Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$10.99B16.7710.02%3.36%20.70%14.59%
71
Outperform
$2.81B20.578.49%2.61%0.62%-24.24%
69
Neutral
$1.78B16.527.50%1.68%12.40%11.98%
67
Neutral
$958.85M22.089.70%2.56%11.91%16.88%
67
Neutral
$17.75B18.235.29%3.57%7.33%12.21%
66
Neutral
$2.89B23.0113.77%2.53%8.55%13.57%
61
Neutral
$450.37M22.798.56%2.80%4.09%-14.30%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AWR
American States Water
74.58
-4.15
-5.27%
WTRG
Essential Utilities
39.22
1.32
3.48%
CWT
California Water Service
46.77
-5.45
-10.44%
MSEX
Middlesex Water Company
52.81
-6.79
-11.39%
HTO
H2O America
50.06
-6.39
-11.32%
YORW
The York Water Company
31.06
-6.12
-16.46%

American States Water Corporate Events

Private Placements and Financing
American States Water Issues Shares to Reduce Debt
Neutral
Jun 3, 2025

On May 30, 2025, Golden State Water Company issued 3.65 common shares to its parent, American States Water Company, for a $50 million contribution, which was used to reduce outstanding borrowings. Additionally, on May 29, 2025, GSWC executed a note purchase agreement for $100 million in unsecured private placement notes to further pay down its credit agreement, with specific terms restricting additional indebtedness based on financial ratios.

The most recent analyst rating on (AWR) stock is a Hold with a $87.00 price target. To see the full list of analyst forecasts on American States Water stock, see the AWR Stock Forecast page.

Private Placements and Financing
American States Water Issues Shares to Reduce Debt
Neutral
Jun 3, 2025

On May 30, 2025, Golden State Water Company issued 3.65 common shares to American States Water Company for $50 million to reduce its credit borrowings. Additionally, on May 29, 2025, GSWC entered a note purchase agreement for $100 million in unsecured notes to further pay down its credit agreement, with specific financial covenants to maintain certain debt ratios.

The most recent analyst rating on (AWR) stock is a Hold with a $87.00 price target. To see the full list of analyst forecasts on American States Water stock, see the AWR Stock Forecast page.

Executive/Board ChangesShareholder Meetings
American States Water Holds Annual Shareholder Meeting
Neutral
May 22, 2025

On May 20, 2025, American States Water held its annual meeting of shareholders where key decisions were made. The election of Class II directors resulted in Ms. Diana M. Bontá, Ms. Mary Ann Hopkins, and Mr. Robert J. Sprowls receiving significant support. Additionally, shareholders approved the compensation of the company’s named executive officers and ratified the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm.

The most recent analyst rating on (AWR) stock is a Hold with a $87.00 price target. To see the full list of analyst forecasts on American States Water stock, see the AWR Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 14, 2025