American Water Works (AWK)

Utilities · $29.7B market cap · SEC CIK 0001410636

Next reports on Feb 16, 2027, after the close, with analysts expecting $1.51 in earnings per share.

52-week range $120.57 to $153.69. 2% below its 52-week high and 25% above its low.

The case for AWK

• 21% of revenue drops through to net profit.
• Moves less than the market (beta 0.52).
• Pays a modest 2.1% dividend.

The case against

• Burned $1.1B of free cash in FY2025.
• Long-term debt of $12.8B would take 6 years of operating cash flow to repay.
• Current liabilities exceed current assets (ratio 0.39).
• P/E of 26.2× is higher than 97% of Utilities companies.
• Growth is weak (40/100): revenue +5.4%, EPS +1.3%, +6.4% a year over five years.
• Price/sales of 5.6× is higher than 87% of Utilities companies.

What the score is made of

Each factor is half a curve over reported figures and half a rank among the other Utilities companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.

• Each factor except momentum is half fixed thresholds, half rank among the 31 Utilities companies.

The financials

The financials, five years deep

Pulled from American Water Works's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.

What American Water Works says it does

The Company With a history dating back to 1886, American Water is the largest and most geographically diverse, publicly-traded water and wastewater utility company in the United States, as measured by both operating revenues and population served. A holding company originally incorporated in Delaware in 1936, the Company employs approximately 7,000 professionals who provide drinking water, wastewater and other related services to approximately 14 million people in 24 states. The Company conducts the majority of its business through regulated utilities that provide water and wastewater services, collectively presented as one reportable segment, referred to as the “Regulated Businesses.” The Company also operates other businesses that provide water and wastewater services to the U.S. government on military installations, as well as municipalities. Individually, these other businesses do not meet the criteria of a reportable segment in…

Risk factors AWK lists in its 10-K

• variability may cause increased weather volatility and may impact water usage and related revenue or require additional expenditures, all of which may not be fully recoverable in rates or otherwise
• Changes in laws and regulations can significantly and materially affect our business, financial condition, results of operations, cash flows and liquidity
• Regulatory and environmental risks associated with the collection, treatment and disposal of wastewater may impose significant costs and liabilities
• A loss of one or more large industrial or commercial customers could have a material adverse impact upon the results of operations of one or more of our Regulated Businesses
• Aging infrastructure may lead to service disruptions, property damage and increased capital expenditures and O&M expenses and other costs, all of which could negatively impact our financial results
• Seasonality could adversely affect the volume of water sold and our revenues
• We are subject to adverse publicity and reputational risks, which make us vulnerable to negative customer perception and could lead to increased regulatory oversight or sanctions
• The failure of, or the requirement to repair, upgrade or dismantle, any of our dams may adversely affect our financial condition, results of operations, cash flows and liquidity
• Any failure of our network of water and wastewater pipes, water mains and water reservoirs could result in losses and damages that may affect our financial condition and reputation
• We have been, and may in the future be, subject to physical and cyber attacks
• We rely on technology to facilitate the management of our business as well as our customer and supplier relationships, and a failure or disruption of implemented technology could materially and adversely affect our business
• An inability to successfully develop and implement new technologies poses substantial risks to our business and operational excellence strategies, which could have a material adverse effect on our business and financial results
• Work stoppages and other labor relations matters could adversely affect our results of operations and the ability to serve our customers
• Our indebtedness could adversely affect our business and limit our ability to plan for or respond to changes in our business, and we may be unable to generate sufficient cash flows to satisfy our liquidity needs
• In certain bankruptcy or insolvency events, the forward sale agreements will automatically terminate, and we would not receive the expected proceeds from the forward sales of our common stock
• Parent company may be unable to meet its ongoing and future financial obligations and to pay dividends on its common stock if its subsidiaries are unable to pay upstream dividends or repay funds
• Market volatility and other conditions may impact the value of benefit plan assets and liabilities, as well as assumptions related to the benefit plans, which may require us to provide significant additional funding
• The proposed Essential merger may cause suppliers, strategic partners, certain customers or others to delay or defer decisions regarding our business, and may adversely affect our ability to effectively manage our business
• We may be the target of securities class action and derivative lawsuits which could result in substantial costs and may delay or prevent the proposed Essential merger from being completed
• If completed, the proposed Essential merger may not achieve its anticipated results, and we may be unable to integrate Essential’s operations and/or operate the combined company in the manner expected
• The proposed Essential merger may not be accretive to our earnings and may adversely affect our earnings per share, which may negatively affect the market price of our common stock
• The combined company’s financial condition, results of operations and cash flows could be adversely affected by unknown or unexpected events, conditions or actions that occur prior to the closing of the proposed Essential merger
• We cannot assure that we will be able to continue paying quarterly dividends at the current rate, or to propose and/or maintain future quarterly dividend increases as planned
• We may incur substantial and/or unexpected transaction fees and merger-related costs in connection with the proposed Essential merger
• Current shareholders will have reduced ownership and voting interests after the proposed Essential merger
• Members of our management and our Board of Directors have interests in the proposed Essential merger that may be different from, or in addition to, those of other shareholders
• MSG’s operations are subject to various risks associated with doing business with the U.S. government
• New accounting standards or changes to existing accounting standards could materially impact how we report our results of operations, cash flows and financial condition
• Undetected errors in internal controls and information reporting could result in the disallowance of cost recovery and noncompliant disclosure
• Our continued success is dependent upon our ability to attract, hire and retain highly qualified and skilled employees
• Our business may be adversely affected by the intentional or other misconduct of our employees and contractors

Filings

Other Utilities companies