Is Wall Street Bullish or Bearish on American Water Works Stock?
With a market cap of $27.8 billion, American Water Works Company, Inc. (AWK) is a leading provider of water and wastewater services across the United States. Through its extensive infrastructure and subsidiaries, the company serves approximately 3.5 million customers in 14 states, including residential, commercial, industrial, and public sector clients.
Shares of the Camden, New Jersey-based company have underperformed the broader market over the past 52 weeks. American Water Works stock has returned 6.2% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 12.5%. However, shares of AWK are up 14.5% on a YTD basis, outpacing SPX's 1.3% gain.
Looking closer, the water utility has lagged behind the Utilities Select Sector SPDR Fund's (XLU) 13.7% increase over the past 52 weeks.
Despite reporting better-than-expected Q1 2025 net income of $1.05 and $1.1 billion in revenue on Apr. 30, AWK share fell marginally the next day. Operating expenses rose by $78 million year-over-year, driven by higher employee costs, taxes, and $29 million in increased depreciation, while interest expense increased by $17 million due to higher debt levels tied to capital investments.
For the fiscal year, ending in December 2025, analysts expect AWK's EPS to grow 5.9% year-over-year to $5.71. The company's earnings surprise history is mixed. It beat the consensus estimates in two of the last four quarters while missing on two other occasions.
Among the 15 analysts covering the stock, the consensus rating is a “Hold.” That’s based on three “Strong Buy” ratings, nine “Holds,” two “Moderate Sell,” and one “Strong Sell.”
This configuration is slightly less bullish than three months ago, with four “Strong Buy” ratings on the stock.
On May 14, Argus reaffirmed its “Buy” rating on American Water Works with a price target of $155, citing strong revenue and earnings growth driven by strategic rate hikes and acquisitions.
As of writing, AWK is trading below the mean price target of $144.58. The Street-high price target of $160 implies a potential upside of 12.2%.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.