American States Water Co
Find Ratings Reports
0.51 |
1.29%
AMERICAN STATES WATER CO's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. AMERICAN STATES WATER CO has very weak liquidity. Currently, the Quick Ratio is 0.35 which clearly shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.
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| Income Statement | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Net Sales ($mil) | 111.95 | 114.62 |
| EBITDA ($mil) | 41.38 | 41.07 |
| EBIT ($mil) | 31.77 | 30.53 |
| Net Income ($mil) | 16.74 | 15.65 |
| Balance Sheet | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Cash & Equiv. ($mil) | 4.52 | 43.86 |
| Total Assets ($mil) | 1406.3 | 1343.36 |
| Total Debt ($mil) | 384.73 | 325.92 |
| Equity ($mil) | 476.7 | 477.58 |
| Profitability | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Gross Profit Margin | 55.97 | 53.69 |
| EBITDA Margin | 36.95 | 35.82 |
| Operating Margin | 28.38 | 26.64 |
| Sales Turnover | 0.32 | 0.35 |
| Return on Assets | 4.23 | 4.65 |
| Return on Equity | 12.49 | 13.08 |
| Debt | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Current Ratio | 0.83 | 1.58 |
| Debt/Capital | 0.45 | 0.41 |
| Interest Expense | 5.6 | 5.53 |
| Interest Coverage | 5.67 | 5.52 |
| Share Data | Q2 FY16 | Q2 FY15 |
|---|---|---|
| Shares outstanding (mil) | 36.56 | 37.24 |
| Div / share | 0.22 | 0.21 |
| EPS | 0.45 | 0.41 |
| Book value / share | 13.04 | 12.82 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 158528.0 | 200134.0 |
BUY. The current P/E ratio indicates a premium compared to an average of 23.64 for the Water Utilities industry and a value on par with the S&P 500 average of 25.19. For additional comparison, its price-to-book ratio of 3.17 indicates a premium versus the S&P 500 average of 2.82 and a premium versus the industry average of 2.51. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. After reviewing these and other key valuation criteria, AMERICAN STATES WATER CO proves to trade at a premium to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| AWR 25.85 | Peers 23.64 | AWR 18.44 | Peers 11.11 | |||||||||||||||||||||
|
Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation. AWR is trading at a valuation on par with its peers. |
Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. AWR is trading at a significant premium to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| AWR 24.05 | Peers 21.60 | AWR 8.29 | Peers 3.75 | |||||||||||||||||||||
|
Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations. AWR is trading at a premium to its peers. |
Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. AWR trades at a significant premium to its peers. |
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| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| AWR 3.17 | Peers 2.51 | AWR -1.24 | Peers 11.82 | |||||||||||||||||||||
|
Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. AWR is trading at a significant premium to its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, AWR is expected to significantly trail its peers on the basis of its earnings growth rate. |
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| Price/Sales |
|
Sales Growth |
|
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| AWR 3.37 | Peers 5.77 | AWR -3.28 | Peers 2.27 | |||||||||||||||||||||
|
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. AWR is trading at a significant discount to its industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. AWR significantly trails its peers on the basis of sales growth |
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