📊 AWR Key Takeaways
Is American States Water Co (AWR) a Good Investment?
American States Water operates a defensible utility business with solid operating margins (30.4%) and positive free cash flow generation ($22.6M), but the 381% revenue spike paired with only 0.4% net income growth reveals severe operational headwinds, likely from a recent large acquisition that has failed to accrete earnings. Tight interest coverage (2.0x) and depressed returns on equity (2.8%) compound concerns about debt servicing capacity and capital efficiency.
American States Water shows solid core utility fundamentals with strong operating and net margins, acceptable leverage, and healthy interest coverage. However, the very large revenue increase paired with essentially flat net income suggests weak growth conversion, and negative free cash flow indicates that current growth is capital-intensive rather than immediately accretive.
American States Water Co Key Strengths (AWR)
- Essential water utility business with recurring revenue model and pricing power
- Strong operating margin of 30.4% demonstrates operational control
- Positive free cash flow generation ($22.6M) with 13.4% FCF margin funds dividends and debt service
- Moderate leverage with Debt/Equity of 0.74x provides room for borrowing if needed
- Strong profitability with 30.9% operating margin and 19.8% net margin
- Balanced financial health with 1.32x current ratio, 0.75x debt/equity, and 7.8x interest coverage
- Stable earnings profile supported by positive operating cash flow of $229.73M and modest EPS growth
AWR Stock Risks: American States Water Co Investment Risks
- Massive revenue growth (381% YoY) with negligible net income growth (0.4%) indicates acquisition integration failure or significant non-cash charges
- Interest coverage of 2.0x is alarmingly low for a utility, leaving minimal buffer for operational disruptions or rate shocks
- Return on Equity of 2.8% and ROA of 1.1% are severely depressed, suggesting capital is not being deployed efficiently
- Cash position of only $22.2M relative to $2.7B total assets is lean given potential acquisition debt service obligations
- Revenue growth quality looks weak because revenue rose 381.3% while net income increased only 0.4%
- Free cash flow is negative due to capital expenditures exceeding operating cash flow
- Low cash balance of $18.82M reduces flexibility if capital needs or financing costs rise
Key Metrics to Watch
- Net income accretion from acquired business and integration timeline to profitability
- Interest coverage ratio trend—any further decline below 2.0x would be critical
- Free cash flow sustainability and dividend coverage ratio post-acquisition
- Free cash flow and capital expenditure intensity
- Net income and EPS growth relative to revenue growth
American States Water Co (AWR) Financial Metrics & Key Ratios
💡 AI Analyst Insight
American States Water Co presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
AWR Profit Margin, ROE & Profitability Analysis
AWR vs Utilities Sector: How American States Water Co Compares
How American States Water Co compares to Utilities sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is American States Water Co Stock Overvalued? AWR Valuation Analysis 2026
Based on fundamental analysis, American States Water Co has mixed fundamental signals relative to the Utilities sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
American States Water Co Balance Sheet: AWR Debt, Cash & Liquidity
AWR Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: American States Water Co's revenue has grown significantly by 13% over the 5-year period, indicating strong business expansion. The most recent EPS of $3.36 reflects profitable operations.
AWR Revenue Growth, EPS Growth & YoY Performance
AWR Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $148.0M | $26.8M | $0.70 |
| Q3 2025 | $161.8M | $23.1M | $0.95 |
| Q2 2025 | $155.3M | $23.1M | $0.85 |
| Q1 2025 | $135.3M | $23.1M | $0.62 |
| Q3 2024 | $151.7M | $23.1M | $0.85 |
| Q2 2024 | $155.3M | $23.1M | $0.85 |
| Q1 2024 | $135.3M | $23.1M | $0.62 |
| Q3 2023 | $135.0M | $14.2M | $0.69 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
American States Water Co Dividends, Buybacks & Capital Allocation
AWR SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for American States Water Co (CIK: 0001056903)
📋 Recent SEC Filings
❓ Frequently Asked Questions about AWR
What is the AI rating for AWR?
American States Water Co (AWR) has a Combined AI Grade of B from Claude (B) and ChatGPT (B) with 68% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are AWR's key strengths?
Claude: Essential water utility business with recurring revenue model and pricing power. Strong operating margin of 30.4% demonstrates operational control. ChatGPT: Strong profitability with 30.9% operating margin and 19.8% net margin. Balanced financial health with 1.32x current ratio, 0.75x debt/equity, and 7.8x interest coverage.
What are the risks of investing in AWR?
Claude: Massive revenue growth (381% YoY) with negligible net income growth (0.4%) indicates acquisition integration failure or significant non-cash charges. Interest coverage of 2.0x is alarmingly low for a utility, leaving minimal buffer for operational disruptions or rate shocks. ChatGPT: Revenue growth quality looks weak because revenue rose 381.3% while net income increased only 0.4%. Free cash flow is negative due to capital expenditures exceeding operating cash flow.
What is AWR's revenue and growth?
American States Water Co reported revenue of $169.2M.
Does AWR pay dividends?
American States Water Co pays dividends, with $19.7M distributed to shareholders in the trailing twelve months.
Where can I find AWR SEC filings?
Official SEC filings for American States Water Co (CIK: 0001056903) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is AWR's EPS?
American States Water Co has a diluted EPS of $0.76.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is AWR's fundamental grade?
Based on our AI fundamental analysis in June 2026, American States Water Co has a B grade with 68% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is AWR stock overvalued or undervalued?
Valuation metrics for AWR: ROE of 2.8% (sector avg: 10%), net margin of 17.7% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
What is AWR's AI grade for 2026?
Our dual AI analysis gives American States Water Co a combined B grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is AWR's free cash flow?
American States Water Co's operating cash flow is $71.6M, with capital expenditures of $49.1M. FCF margin is 13.4%.
How does AWR compare to other Utilities stocks?
Vs Utilities sector averages: Net margin 17.7% (avg: 12%), ROE 2.8% (avg: 10%), current ratio 1.22 (avg: 0.8).