Seaport Research Partners has upgraded $CWT from Neutral to Buy, assigning a $54 price target. This shift comes on the heels of the company’s impressive financial turnaround and strong operational momentum.
💼 In 2024, California Water posted a substantial 30.5% rise in revenue, hitting $1 billion compared to $794.6 million the year prior. Even more compelling, net income surged by over 267%, reaching $190.8 million. Fourth-quarter performance stood out, with earnings per share of $0.33 outpacing expectations, and revenue of $222.2 million topping forecasts.
🚰 A key catalyst behind the upgrade was the company’s approximately 13% rate base growth, paired with a valuation that has become more attractive relative to its peers. Notably, the traditional P/E premium typically granted to water utilities has narrowed versus electric utilities, making $CWT look increasingly appealing to value-focused investors.
💰 Dividend Fundamentals
💵 $CWT is a dividend stalwart, having increased its dividend for 58 consecutive years. The latest announcement included a quarterly payout of $0.30 per share—its 320th straight quarterly dividend—plus a one-time special dividend of $0.04. That translates to an annual dividend of $1.20 per share, yielding around 2.48% at current prices.
📊 The company’s payout ratio sits comfortably at 36.2%, signaling that the dividend is well-supported by earnings and leaves room for continued increases.
🌊 With dependable financial growth and a steady dividend history, California Water is positioning itself as a reliable pick in a sector that’s gaining traction with investors seeking both stability and upside potential.