American States Water (AWR) AI Stock Analysis

• Market Cap: $2.82B
• Dividend Yield: 2.53%
• Average Volume (3M): 234.55K
• Price to Earnings (P/E): 22.6
• Beta (1Y): 0.19
• Revenue Growth: 6.79%
• EPS Growth: 5.96%
• Country: US
• Employees: 517
• Sector: Utilities
• Sector Strength: 80
• Industry: Regulated Water
• EPS (TTM): 0.70
• Shares Outstanding: 38,508,766
• 10 Day Avg. Volume: 228,073
• 30 Day Avg. Volume: 234,553
• PEG Ratio: 9.30
• Price to Book (P/B): 3.02
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -53.80
• Enterprise Value/Market Cap: 1.35
• Enterprise Value/Revenue: 1.62
• Enterprise Value/Gross Profit: 9.02
• Enterprise Value/Ebitda: 4.09
• 1Y Price Target: $78.00
• Price Target Upside: 5.99% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 2

• Rating: 62 Neutral
• Price Target: $82.00 ▲(11.43%Upside)

American States Water's overall score is driven by a strong earnings call and solid financial performance. However, technical analysis reveals cautious market sentiment, and the high valuation suggests potential overvaluation risks. Cash flow management challenges further weigh on the stock's overall stability.

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 Business Overview & Revenue Model

Company Description

American 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 Money

American States Water Company generates revenue primarily through its utility services, which are provided by its key subsidiaries. Golden State Water Company is responsible for delivering water services to residential, commercial, and industrial customers in California, charging customers based on water usage and service fees regulated by the California Public Utilities Commission. American States Utility Services, another subsidiary, enters into long-term contracts with the U.S. government to provide water and wastewater services to military bases. These contracts offer stable and predictable revenue streams. The company's revenue model is heavily influenced by regulatory frameworks, infrastructure investments, and partnerships with government entities to ensure service reliability and compliance with environmental standards.

American States Water Financial Statement Overview

Summary

American States Water shows solid revenue growth and profitability metrics, indicating a well-performing core business. The balance sheet reflects moderate leverage with a stable equity base, but cash flow management is challenging due to negative free cash flow, suggesting a need for strategic investment planning.

Income Statement

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

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

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.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	595.46M	595.70M	491.53M	498.85M	488.24M
Gross Profit	452.02M	449.55M	368.23M	377.82M	368.84M
EBITDA	244.05M	252.54M	170.78M	185.06M	171.04M
Net Income	119.27M	124.92M	78.40M	94.35M	86.42M
Balance Sheet
Total Assets	2.50B	2.25B	2.03B	1.90B	1.79B
Cash, Cash Equivalents and Short-Term Investments	26.66M	14.07M	6.00M	4.96M	36.74M
Total Debt	938.24M	917.88M	734.43M	629.02M	586.55M
Total Liabilities	1.58B	1.47B	878.28M	802.86M	709.58M
Stockholders Equity	920.05M	776.11M	1.16B	1.10B	1.08B
Cash Flow
Free Cash Flow	-33.23M	-120.86M	-48.44M	-28.93M	-8.25M
Operating Cash Flow	198.73M	67.68M	117.80M	115.58M	122.17M
Investing Cash Flow	-232.78M	-188.76M	-167.10M	-145.09M	-131.61M
Financing Cash Flow	46.64M	129.16M	50.34M	-2.27M	44.84M

American States Water Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 73.59
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: 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 73.59 is below the 20-day moving average (MA) of 75.17, below the 50-day MA of 76.86, and below the 200-day MA of 77.93, indicating a bearish trend. The MACD of -1.11 indicates Positive momentum. The RSI at 40.71 is Neutral, neither overbought nor oversold. The STOCH value of 30.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AWR.

American States Water Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WTRG	74 Outperform	$10.32B	16.51	9.78%	3.54%	16.41%	5.65%
HTO	71 Outperform	$1.66B	15.89	7.50%	3.40%	12.40%	11.98%
CWT	67 Neutral	$2.68B	19.75	8.24%	2.67%	0.62%	-24.24%
MSEX	65 Neutral	$929.66M	21.52	9.80%	2.57%	16.02%	18.29%
AWR	62 Neutral	$2.82B	22.59	13.95%	2.53%	6.79%	5.96%
Sector *	60 Neutral	C$5.14B	-23.87	-19.26%	4.50%	12.16%	-71.33%
YORW	58 Neutral	$441.80M	22.44	8.63%	2.87%	3.45%	-19.90%

American States Water Corporate Events

American States Water Issues Shares to Reduce Debt

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.

American States Water Issues Shares to Reduce Debt

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.

American States Water Holds Annual Shareholder Meeting

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.