Essential Utilities (WTRG)
NYSE:WTRG
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Essential Utilities
(NYSE:WTRG)
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Rating:71Outperform
Price Target:
$45.00
â–²(13.67% Upside)
Action:UpgradedDate:03/10/26
The score is driven primarily by steady regulated-utility earnings and supportive earnings-call guidance, offset by structurally negative free cash flow and some 2025 financial-data inconsistencies (notably debt and certain margins). Technicals are favorable with the stock trading above key moving averages, while valuation looks fair with a solid dividend yield. Corporate developments (merger progress and new long-term debt) are constructive but keep regulatory and financing execution risks in focus.
Positive Factors
Regulatory-driven revenue
Material regulatory recoveries added recurring, rate‑approved revenue in 2025, improving visibility into cash flows and the regulated rate base. Over 2–6 months this structural mechanism supports sustainable top-line growth and underpins allowed returns tied to invested capital.
Negative Factors
Persistent negative free cash flow
Ongoing negative free cash flow reflects heavy, recurring capex requirements that outstrip internally generated cash. Over months this implies continued reliance on external financing, tighter flexibility for dividends/transactions, and sensitivity to higher rates or funding constraints.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulatory-driven revenue
Material regulatory recoveries added recurring, rate‑approved revenue in 2025, improving visibility into cash flows and the regulated rate base. Over 2–6 months this structural mechanism supports sustainable top-line growth and underpins allowed returns tied to invested capital.
Read all positive factors
Essential Utilities (WTRG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$11.22B
Dividend Yield3.48%
Average Volume (3M)1.86M
Price to Earnings (P/E)17.4
Beta (1Y)-0.11
Revenue Growth21.35%
EPS Growth20.96%
CountryUS
Employees3,291
SectorUtilities
Sector Strength65
IndustryRegulated Water
Share Statistics
EPS (TTM)0.47
Shares Outstanding283,303,700
10 Day Avg. Volume1,525,575
30 Day Avg. Volume1,860,474
Financial Highlights & Ratios
PEG Ratio12.61
Price to Book (P/B)1.57
Price to Sales (P/S)4.34
P/FCF Ratio-25.61
Enterprise Value/Market Cap1.74
Enterprise Value/Revenue7.87
Enterprise Value/Gross Profit14.72
Enterprise Value/Ebitda14.26
Forecast
1Y Price Target
$38.00Price Target Upside-4.02% Downside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)2.26
Revenue Forecast (FY)$2.43B
Essential Utilities Business Overview & Revenue Model
Company Description
Essential Utilities, Inc., through its subsidiaries, operates regulated utilities that provide water, wastewater, or natural gas services in the United States. It offers water services through operating and maintenance contract with municipal auth...
How the Company Makes Money
Essential Utilities generates revenue primarily through the provision of water and natural gas services to its customers. The company's revenue model is based on regulated utility rates, which are determined by state Public Utility Commissions (PU...
Essential Utilities Key Performance Indicators (KPIs)
Any
Operating Expense Breakdown
Details core costs like maintenance, labor, and infrastructure, offering insight into how efficiently Essential Utilities manages its resources and where it’s prioritizing investment to ensure reliable water and wastewater services.
Details core costs like maintenance, labor, and infrastructure, offering insight into how efficiently Essential Utilities manages its resources and where it’s prioritizing investment to ensure reliable water and wastewater services.
Data provided by:
The Fly
The FlyEssential Utilities Earnings Call Summary
Earnings Call Date:Feb 25, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 11, 2026
Earnings Call Sentiment Positive
The call highlighted strong financial and operational performance in 2025 — including an 18.6% revenue increase, GAAP EPS of $2.20 beating guidance, record $1.4B infrastructure investment, meaningful regulatory recoveries, ongoing acquisitions, and continued dividend growth — while acknowledging several headwinds such as merger-related expenses, nonrecurring items that complicate comparability, and a specific legal/regulatory delay on the DELCORA transaction. Management reaffirmed 5%–7% multi-year EPS growth guidance, signaled healthy credit metrics, and remains optimistic about closing the merger in 2027 despite regulatory timing uncertainty.Positive Updates
Revenue Growth
Total revenue increased $388.5 million, or 18.6% year-over-year, from about $2.1 billion to near $2.5 billion in 2025.
Negative Updates
Nonrecurring and 'Other' Items Reduced Underlying EPS
A $0.48-per-share 'other' headwind included removal of prior-year gains and increased depreciation, amortization, interest, and taxes; prior-year gain removal accounted for ~$0.24 of the impact.
Read all updates
Q4-2025 Updates
Positive
Negative
Revenue Growth
Total revenue increased $388.5 million, or 18.6% year-over-year, from about $2.1 billion to near $2.5 billion in 2025.
Read all positive updates
Company Guidance
Management reaffirmed a 5%–7% multiyear EPS CAGR for 2024–2027 (to be applied to 2024 non‑GAAP income per share of $1.97), noted 2025 GAAP EPS of $2.20 (above prior guidance of $2.07–$2.11) and 2024 GAAP EPS of $2.17, and expects the transaction to close in 2027 (DELCORA excluded from guidance); they plan $1.7 billion of regulated infrastructure investment in 2026 (vs. a record $1.4 billion in 2025), will maintain a 60%–65% payout ratio and continued dividend growth (5.25% increase in July; 35 increases in 34 years; 80 consecutive years paying dividends), aim to strengthen balance-sheet metrics with FFO-to-debt comfortably above a ~12% ratings threshold, and continue regulatory-driven revenue growth after completing $101.5 million of incremental annualized recoveries in 2025 ($92.6M water/wastewater), $12.4M so far in 2026, and filing for $101.9M of water/wastewater annualized revenue requests while pursuing acquisitions (2025 buys ≈$58M for >12,700 customers; three signed deals expected to close in 2026).Essential Utilities Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
67
Positive
Cash Flow
55
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.47B | 2.09B | 2.05B | 2.29B | 1.88B |
| Gross Profit | 1.01B | 1.22B | 1.13B | 1.07B | 987.30M |
| EBITDA | 1.37B | 1.25B | 1.06B | 1.01B | 927.66M |
| Net Income | 616.37M | 595.31M | 498.23M | 465.24M | 431.61M |
Balance Sheet | |||||
| Total Assets | 19.89B | 18.03B | 16.84B | 15.72B | 14.66B |
| Cash, Cash Equivalents and Short-Term Investments | 34.78M | 9.16M | 4.61M | 11.40M | 10.57M |
| Total Debt | 8.34B | 7.73B | 7.09B | 6.84B | 6.02B |
| Total Liabilities | 13.04B | 11.83B | 10.95B | 10.34B | 9.47B |
| Stockholders Equity | 6.86B | 6.20B | 5.90B | 5.38B | 5.18B |
Cash Flow | |||||
| Free Cash Flow | -419.52M | -559.40M | -265.52M | -462.46M | -375.84M |
| Operating Cash Flow | 1.01B | 770.34M | 933.59M | 600.31M | 644.68M |
| Investing Cash Flow | -1.51B | -1.16B | -1.22B | -1.18B | -1.06B |
| Financing Cash Flow | 525.91M | 397.48M | 281.36M | 578.83M | 417.12M |
Essential Utilities Technical Analysis
Neutral
39.59
Price Trends
39.67
Negative
39.03
Positive
38.48
Positive
Market Momentum
0.15
Positive
44.61
Neutral
65.36
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WTRG, the sentiment is Neutral. The current price of 39.59 is below the 20-day moving average (MA) of 40.47, below the 50-day MA of 39.67, and above the 200-day MA of 38.48, indicating a neutral trend. The MACD of 0.15 indicates Positive momentum. The RSI at 44.61 is Neutral, neither overbought nor oversold. The STOCH value of 65.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for WTRG.
Essential Utilities Risk Analysis
Essential Utilities disclosed 35 risk factors in its most recent earnings report. Essential Utilities 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 0 New Risks
Essential Utilities Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $11.22B | 17.43 | 9.18% | 3.48% | 21.35% | 20.96% | |
68 Neutral | $23.83B | 10.77 | 20.64% | 2.22% | -10.23% | -26.87% | |
67 Neutral | $962.21M | 26.96 | 9.08% | 2.67% | 6.24% | 3.35% | |
66 Neutral | $26.25B | 22.91 | 10.34% | 2.51% | 12.29% | 13.13% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $2.95B | 21.42 | 13.10% | 2.64% | 10.28% | 13.56% | |
58 Neutral | $2.69B | 20.13 | 7.68% | 2.88% | -2.60% | -33.78% |
* Utilities Sector Average
WTRG
Essential Utilities
39.47
0.94
2.43%
AWR
American States Water
75.86
-1.77
-2.27%
AWK
American Water
133.39
-9.89
-6.90%
CWT
California Water Service
45.13
-4.28
-8.67%
SBS
Companhia De Saneamento
33.80
16.76
98.36%
MSEX
Middlesex Water Company
51.86
-9.38
-15.32%
Essential Utilities Corporate Events
Private Placements and Financing
Essential Utilities Issues $500 Million Senior Notes Offering
Positive
Mar 9, 2026
On March 9, 2026, Essential Utilities, Inc. issued $500 million of 5.125% senior notes due March 15, 2036, under its existing indenture with U.S. Bank Trust Company, National Association, as trustee. The notes pay interest semi-annually beginning ...
M&A TransactionsShareholder Meetings
Essential Utilities Shareholders Approve Transformative American Water Merger
Positive
Feb 10, 2026
On February 10, 2026, Essential Utilities held a special shareholder meeting at which 76.2% of outstanding shares were represented, and investors decisively approved the merger agreement with American Water Works Company, Inc. Shareholders also ba...
M&A TransactionsRegulatory Filings and ComplianceShareholder Meetings
Essential Utilities Shareholders Approve Merger with American Water
Positive
Feb 10, 2026
On February 10, 2026, shareholders of American Water Works Company, Inc. and Essential Utilities, Inc. approved proposals related to their planned merger, based on preliminary voting results from respective special meetings. The shareholder approv...
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.