American States Water (AWR) Down 9.2% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for American States Water (AWR). Shares have lost about 9.2% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is American States Water due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

American States Water's Earnings Beat Estimates in Q4

American States Water generated fourth-quarter 2019 operating earnings of 45 cents per share, which beat the Zacks Consensus Estimate of 41 cents by 9.8%. Further, the bottom line rallied 21.6% from 37 cents in the year-ago quarter.

In 2019, earnings came in at $2.24 per share compared with $1.72 in 2018.

Total Revenues

Operating revenues amounted to $113 million, which missed the Zacks Consensus Estimate of $117 million by 3.4%. However, the top line inched up 1.8% from $111 million in the prior-year quarter. Total revenues increased primarily on the back of higher revenues in the Water and Electric segments.

In 2019, the company delivered revenues of $473.9 million compared with $436.8 million in 2018.

Operational Update

In the quarter under review, American States Water’s total operating expenses were $88.3 million, up 0.01% year over year.

Interest expenses were $5.7 million, up 3.5% year over year. Also, interest income was $0.6 million, down from $1.7 million in the prior-year quarter.

Segment Details

Earnings in the Water segment were 28 cents, up from 17 cents in the prior-year quarter.

Earnings in the Electric segment amounted to 5 cents, up from 3 cents in the year-ago quarter.

Earnings in the Contracted Services segment were 12 cents, which declined 33.3% from the year-ago quarter’s tally.

Financial Update

As of Dec 31, 2019, American States Water’s cash and cash equivalents were $1.3 million compared with $7.1 million as of Dec 31, 2018.

As of Dec 31, 2019, the company’s long-term debts were $280.9 million compared with $281 million as of Dec 31, 2018.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

Currently, American States Water has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

American States Water has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.