American Water Works Earnings: Here’s Why the Stock is Rising Now

American Water Works Company, Inc. (NYSE:AWK) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 0.74%.

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American Water Works Company, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 17.86% to $0.33 in the quarter versus EPS of $0.28 in the year-earlier quarter.

Revenue: Rose 2.84% to $636.14 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: American Water Works Company, Inc. reported adjusted EPS income of $0.33 per share. By that measure, the company beat the mean analyst estimate of $0.32. It missed the average revenue estimate of $650.29 million.

Quoting Management: “We are off to a good start for 2013 with a strong first quarter for American Water, with increases in net income, earnings per share and revenues. We also had several successes in executing our growth strategy,” said Jeff Sterba, president and CEO of American Water. “We closed multiple tuck-ins in Pennsylvania, California, Indiana and Missouri, and recently announced two other acquisition agreements. These transactions add more than 22,000 customers to our regulated footprint. In our market-based Homeowner Services business, we reached an important milestone with 1 million customer contracts. Our continuing performance and success in delivering on our strategy resulted in the decision to increase the company’s quarterly dividend to shareholders by 12 percent to 28 cents per share.”

Key Stats (on next page)…

Revenue decreased 6.58% from $680.91 million in the previous quarter. EPS increased 3.13% from $0.32 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.63 to a profit $0.64. For the current year, the average estimate has moved down from a profit of $2.22 to a profit of $2.21 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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