Zacks Industry Outlook Highlights Essential Utilities, Primo Water, California Water Service and American States Water
Written by Emily J. Thompson, Senior Investment Analyst
Source: NASDAQ.COM
Water Utility Industry Overview:
- Water utilities in the U.S. ensure clean water supply and sewer services for millions of customers.
- Essential Utilities, Primo Water Corp., California Water Service Group, and American States Water Co. are key players in the industry.
Challenges and Upgrades:
- Aging pipelines require continuous upgrades to minimize disruptions.
- Large investments are needed to maintain and expand water infrastructure due to aging assets.
Interest Rate Impact:
- Utility operators may benefit from a possible interest rate decline in 2024 for infrastructure investments.
- Previous rate hikes by the Federal Reserve had adversely affected utility operators.
Investment Needs:
- The U.S. water and wastewater infrastructure requires an estimated $896 billion investment over the next 20 years.
- The Bipartisan Infrastructure Law allocated $50 billion to strengthen water systems, focusing on disadvantaged communities.
Stock Recommendations:
- California Water Service Group, Primo Water Corp., Essential Utilities, and American States Water Company are highlighted as stocks with growth potential in the water supply industry.
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Analyst Views on WTRG
Wall Street analysts forecast WTRG stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for WTRG is 42.50 USD with a low forecast of 38.00 USD and a high forecast of 45.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
7 Analyst Rating
2 Buy
4 Hold
1 Sell
Hold
Current: 38.100
Low
38.00
Averages
42.50
High
45.00
Current: 38.100
Low
38.00
Averages
42.50
High
45.00
About WTRG
Essential Utilities, Inc. is the holding company for regulated utilities providing water, wastewater, or natural gas services. The Company’s segments include Regulated Water and Regulated Natural Gas. The Regulated Water segment consists of eight operating segments representing its water and wastewater regulated utility companies, which are organized by the states where the Company provides water and wastewater services. The Regulated Natural Gas segment consists of one operating segment representing natural gas utility companies for which the Company provides natural gas distribution services. It provides services in Pennsylvania, Ohio, Texas, Illinois, North Carolina, New Jersey, Indiana, Virginia, and Kentucky under the Aqua and Peoples brands. The Company also operates market-based activities, conducted through its non-regulated subsidiaries, that provide utility service line protection solutions and repair services to households and gas marketing and production activities.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Essential Utilities Faces Shareholder Rights Investigation Post Acquisition by American Water
- Shareholder Rights Investigation: Halper Sadeh LLC is investigating Essential Utilities, Inc. (NYSE:WTRG) regarding its sale to American Water Works Company, Inc., which involves a potential exchange of 0.305 shares of American Water for each share of Essential, potentially impacting shareholder interests.
- Transaction Disclosure Details: The structure of this acquisition may pose risks of equity dilution for Essential shareholders, prompting Halper Sadeh LLC to seek increased compensation and additional disclosures to ensure shareholders' legal rights are protected.
- Market Reaction Monitoring: Given the potential violations of federal securities laws involved in the transaction, investor reactions could significantly affect the stock performance of Essential Utilities, thereby influencing market confidence.
- Legal Support Offered: Halper Sadeh LLC provides legal consultations without upfront fees, encouraging shareholders to reach out to understand their legal rights and options, demonstrating a commitment to protecting shareholder interests.
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Halper Sadeh Investigates AWK-Essential Merger, Shareholders to Own 69% Post-Deal
- Merger Investigation: Halper Sadeh LLC is investigating the merger between American Water Works and Essential Utilities, with American Water shareholders expected to own approximately 69% of the combined entity post-transaction, indicating significant control and potential benefits for shareholders.
- Shareholder Rights: The law firm is also focusing on the rights of Essential Utilities shareholders, who will receive 0.305 shares of American Water for each share held, ensuring that shareholder interests are protected during the merger process.
- Legal Support: Halper Sadeh LLC offers legal consultations without upfront fees, encouraging shareholders to reach out to discuss their legal rights and options, demonstrating a commitment to safeguarding shareholder interests.
- Investor Protection: The firm represents investors globally, fighting against securities fraud and corporate misconduct, and has successfully recovered millions for defrauded investors in the past, highlighting its expertise in protecting investor rights.
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