American Water Works AWK announced that its subsidiary, New Jersey American Water is going to invest $285,000 for adding nearly 800 feet of water mains in Neptune. The project will include installing two utility-owned service lines along the pipeline route.
These new additions to the existing infrastructure will increase resilience of operations and provide more water flow for customers in the region. New Jersey American Water invests millions of dollar annually to upgrade, and properly maintain water as well as wastewater assets.
Regular Investment Essential for Water Space
U.S. water utilities own millions of miles of pipelines that are buried under the soil, and play an active role in providing 24x7 water as well as sewer services. However, the water infrastructure is gradually approaching toward the end of effective life. As a consequence, pipeline breakage is causing wastage of potable water.
Per findings of the American Society of Civil Engineers, nearly 300,000 line breaks occur every year in the United States due to aging of the existing water infrastructure. The pipeline breaks result in the wastage of millions of gallons of potable water each day and add to the loss of water utility operators.
Per the Water and Wastewater Equipment Manufacturers Association, an estimated $750 billion investment is necessary to maintain and expand the drinking water and wastewater service to meet demand over the next 20 years. American Water continues to make investments in its infrastructure to upgrade, enhance and maintain the same. The company has plans to invest $8.8-$9.4 billion in the 2020-2024 time period and $20-$22 billion in the next decade.
Essential Utilities WTRG is also making regular investments to upgrade the existing water and wastewater systems. Its long-term plan is to invest $2.8 billion in the 2020-2022 time period to rehabilitate, and strengthen water as well as natural gas pipeline systems. Another water utility, California Water Service Group CWT has plans to invest $839 million in its water infrastructure in the 2019-2021 time period.
Price Performance
Shares of American Water have outperformed the industry in the past 12 months.
Zacks Rank and Key Pick
American Water currently has a Zacks Rank #3 (Hold). A better-ranked stock in the same industry is Primo Water Corporation PRMW, having a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Primo Water delivered an average earnings surprise of 65% in the last four reported quarters. The Zacks Consensus Estimate for its 2020 earnings has moved 32.5% upward to 53 cents per share in the past 60 days.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.4% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
American Water Works Company, Inc. (AWK): Free Stock Analysis Report
California Water Service Group (CWT): Free Stock Analysis Report
Primo Water Corporation (PRMW): Free Stock Analysis Report
Essential Utilities Inc. (WTRG): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
