📊 AWR Key Takeaways
Is American States Water Co (AWR) a Good Investment?
American States Water demonstrates solid operational profitability with 30.9% operating margins and stable net margins of 19.8%, supported by strong interest coverage of 7.8x indicating manageable debt levels. However, concerning negative free cash flow of -7.1M despite $229.7M operating cash flow signals that capital expenditures exceed operational returns, which is unsustainable long-term despite the company's regulated utility status providing revenue stability.
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.
Why Buy American States Water Co Stock? AWR Key Strengths
- High operating margin of 30.9% and net margin of 19.8% demonstrate efficient operations in regulated water utility sector
- Strong interest coverage ratio of 7.8x indicates solid debt service capability with moderate leverage at 0.75x debt-to-equity
- Substantial operating cash flow of $229.7M provides base capital for infrastructure reinvestment typical in utilities sector
- 12.5% ROE and 4.8% ROA reflect reasonable returns on deployed capital for regulated utility
- 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
- Negative free cash flow of -7.1M is concerning; CapEx of $236.8M exceeds operating cash flow, requiring debt financing or rate increases
- Extremely high revenue growth of 381.3% YoY appears anomalous and requires investigation into acquisition activity or accounting changes rather than organic growth
- Low cash position of only $18.8M relative to $2.7B total assets and $782.7M long-term debt limits financial flexibility for emergencies
- Deteriorating capital efficiency: rising CapEx requirements without corresponding FCF growth threatens dividend sustainability and equity returns
- 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
- Free cash flow trend and sustainability of capital expenditure levels relative to operating cash generation
- Source and sustainability of 381% revenue growth - verify if organic or acquisition-driven
- Debt levels and refinancing needs given low cash reserves relative to debt burden
- Regulatory rate approval timelines to ensure CapEx investments generate authorized returns
- 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 appears fundamentally strong 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 |
|---|---|---|---|
| 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 |
| Q2 2023 | $122.6M | $14.2M | $0.54 |
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 Rating of BUY from Claude (BUY) and ChatGPT (HOLD) with 76% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are AWR's key strengths?
Claude: High operating margin of 30.9% and net margin of 19.8% demonstrate efficient operations in regulated water utility sector. Strong interest coverage ratio of 7.8x indicates solid debt service capability with moderate leverage at 0.75x debt-to-equity. 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: Negative free cash flow of -7.1M is concerning; CapEx of $236.8M exceeds operating cash flow, requiring debt financing or rate increases. Extremely high revenue growth of 381.3% YoY appears anomalous and requires investigation into acquisition activity or accounting changes rather than organic growth. 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 $658.1M.
Does AWR pay dividends?
American States Water Co pays dividends, with $74.7M 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 $3.37.
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 rating reflects both perspectives for balanced insights.
Is AWR a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, American States Water Co has a BUY rating with 76% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is AWR stock overvalued or undervalued?
Valuation metrics for AWR: ROE of 12.5% (sector avg: 10%), net margin of 19.8% (sector avg: 12%). Higher ROE suggests strong returns relative to peers.
Should I buy AWR stock in 2026?
Our dual AI analysis gives American States Water Co a combined BUY rating 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 $229.7M, with capital expenditures of $236.8M. FCF margin is -1.1%.
How does AWR compare to other Utilities stocks?
Vs Utilities sector averages: Net margin 19.8% (avg: 12%), ROE 12.5% (avg: 10%), current ratio 1.32 (avg: 0.8).