Severn Trent’s stock price falls below key moving average

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Severn Trent Intrinsic Value – Severn Trent ($LSE:SVT) is a water and wastewater company based in the United Kingdom. Severn Trent‘s stock has been under pressure in recent months due to concerns about the company’s debt levels and investment plans.

Market Price

The stock opened at £23.4 and closed at £23.3, down by 0.6% from its last closing price of £23.4. This is a significant development, as it suggests that the stock may be losing momentum. The moving average is a widely used technical indicator, and many investors watch it closely to gauge a stock’s momentum. It serves over eight million customers in the Midlands and northern England. The company has been under pressure in recent years due to a number of challenges, including the impact of the pandemic on its operations. Despite these challenges, Severn Trent has been able to maintain a strong financial position. Looking ahead, Severn Trent is well positioned to weather the challenges it faces. It has a strong balance sheet and a healthy cash flow.

In addition, the company is investing in its infrastructure, which should provide long-term benefits.

VI Analysis – Severn Trent Intrinsic Value Calculator

A company’s fundamentals are its long-term potential indicators, and the VI app makes analysing them simple. The intrinsic value of a SEVERN TRENT share is around £26.1, calculated by VI Line. The stock is currently traded at £23.3, making it a fair price that is undervalued by 11%.

VI Peers

In the water utility industry, Severn Trent PLC faces stiff competition from American States Water Co, Kangda International Environmental Co Ltd, and Athens Water Supply & Sewerage Co. These companies are all large, well-established players in the industry, and they each have a significant market share. Severn Trent PLC must continually innovate and provide high-quality service in order to stay ahead of its competitors.

– American States Water Co ($NYSE:AWR)

American States Water Company is a publicly traded water and wastewater utility company. The Company provides water service to approximately 26,000 customers in the cities of Big Bear Lake, California and San Bernardino, California. American States Water Company also provides wastewater service to approximately 20,000 customers in the city of San Bernardino. In addition, the Company’s subsidiaries, Golden State Water Company and American States Utility Services, Inc., provide water service to approximately 248,000 customers in 36 counties in California.

– Kangda International Environmental Co Ltd ($SEHK:06136)

Kangda International Environmental Co Ltd has a market capitalization of 1.22 billion as of 2022 and a return on equity of 12.47%. The company is engaged in the business of environmental protection and provides environmental protection services in China.

– Athens Water Supply & Sewerage Co ($OTCPK:AHWSF)

Athens Water Supply & Sewerage Co. is a water utility company that provides water and wastewater services to the city of Athens, Greece. The company has a market cap of 748.86M as of 2022 and a Return on Equity of 4.35%. Athens Water Supply & Sewerage Co. is the largest water utility in Greece and one of the largest in Europe. The company serves a population of approximately 3.5 million people.

Summary

Investing in Severn Trent can be a good idea for investors looking for exposure to the UK water sector. The company is the second largest water and wastewater utility in the UK, with a strong track record of delivering shareholder value. Severn Trent also has a strong financial position, with a AA- credit rating and a healthy balance sheet.