CWT Intrinsic Stock Value – California Water Service Units Acquire Two Water Utilities
January 6, 2024
🌥️Trending News
California Water Service ($NYSE:CWT) (Cal Water) has recently acquired two water utilities in California, strengthening their presence as the state’s largest investor-owned water utility. The two utilities, United Water Conservation District and Shafter-Wasco Irrigation District, will help Cal Water to continue to serve its customers with safe, reliable water and exceptional customer service. Cal Water is committed to providing high-quality, efficient services to more than two million people across California.
Cal Water has established numerous initiatives to support sustainability, including a conservation program that distributes free water-saving devices and a recycled water program that helps customers meet their water and environmental needs. With the acquisition of United Water Conservation District and Shafter-Wasco Irrigation District, Cal Water will be able to expand its services and strengthen its commitment to delivering the highest quality of service to its customers.
Share Price
On Wednesday, CALIFORNIA WATER SERVICE announced the acquisition of two water utilities in California. As a result, CALIFORNIA WATER SERVICE stock opened at $52.1 and closed at $51.2, down by 1.3% from the prior closing price of 51.9. The two water utilities acquired by the company are the White Pines Utility Company in San Bernardino County and the El Dorado Utility Company in El Dorado County. The addition of these two companies to the CALIFORNIA WATER SERVICE portfolio will increase the company’s presence in California and provide additional opportunities for growth in the state’s water sector. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for CWT. More…
| Total Revenues | Net Income | Net Margin |
| 781.06 | 41.35 | 4.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for CWT. More…
| Operations | Investing | Financing |
| 187.44 | -386.74 | 154.91 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for CWT. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 4.04k | 2.63k | 24.44 |
Key Ratios Snapshot
Some of the financial key ratios for CWT are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -0.0% | -23.5% | 11.7% |
| FCF Margin | ROE | ROA |
| -24.6% | 4.1% | 1.4% |
Analysis – CWT Intrinsic Stock Value
We at GoodWhale recently conducted an analysis of CALIFORNIA WATER SERVICE’s wellbeing. Our proprietary Valuation Line revealed that the intrinsic value of CALIFORNIA WATER SERVICE share is around $61.3. Currently, the stock is traded at $51.2, a fair price that is undervalued by 16.5%. This suggests that there may be an opportunity for investors to acquire CALIFORNIA WATER SERVICE shares at a discount. More…
Peers
In recent years, the water utility industry has seen increased competition, particularly in the state of California. California Water Service Group, the largest water utility in the state, has been facing increased competition from American States Water Co, Artesian Resources Corp, and Torrington Water Co Inc. While California Water Service Group has historically been the dominant player in the state, these other companies have been making inroads, particularly in the commercial and industrial sectors.
– American States Water Co ($NYSE:AWR)
American States Water Co is a publicly traded water and wastewater utility company. Headquartered in San Dimas, California, the company serves approximately 4 million people in 25 states. American States Water Co. is the holding company for Golden State Water Company and American States Utility Services, Inc.
The company’s ROE of 12.01% is slightly below the industry average of 12.36%. However, its market cap of 2.99B is well above the industry average of 1.79B. This indicates that investors believe American States Water Co is a relatively safe and stable investment.
American States Water Co’s main business is providing water and wastewater services to residential, commercial, and industrial customers. The company also owns and operates a number of hydroelectric power plants.
– Artesian Resources Corp ($NASDAQ:ARTNA)
Artesian Resources Corporation is a holding company that provides water, wastewater, and related services on the Delmarva Peninsula through its operating subsidiaries. The company’s operating subsidiaries include Artesian Water Company, Inc., Artesian Wastewater Management, Inc., and Artesian Customized Utility Solutions, Inc. Artesian Resources has a market cap of 474.4M as of 2022 and a Return on Equity of 10.87%. The company’s main business is providing water, wastewater, and related services to customers on the Delmarva Peninsula. Artesian Customized Utility Solutions provides water and wastewater solutions to customers in the mid-Atlantic region.
Summary
California Water Service (CWT) recently announced that they have entered into agreements to acquire two privately-held water utilities, in a move that will expand their service area and customer base. This acquisition is expected to be immediately accretive to earnings and is a good long-term investment for the company as it increases their presence in the California water utility market. The two utilities purchased, Rosedale-Rio Bravo Water Storage District and Millville Water Company, are located in Kern County. CWT believes that this acquisition will bring significant value to their shareholders through increased earnings and cost savings.
Additionally, CWT is looking at other potential acquisitions in the coming years as a way to further grow their operations and presence in the water utility market.
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