Essential Utilities Inc. Price, Consensus and EPS Surprise

Essential Utilities Inc. price-consensus-eps-surprise-chart | Essential Utilities Inc. Quote

Highlights of WTRG’s Q3 Release

Operation and maintenance expenses were $144.4 million, down 1.8% from the year-ago figure of $147 million. This was due to a decrease in bad debt expense and a lower expense compared with the prior year for the sale of the West Virginia gas utility and energy plant assets.

Operating income was $155.1 million, up 12.9% year over year. Interest expenses increased 11.9% to $76.9 million from $68.6 million in the prior-year quarter.

Essential Utilities signed seven purchase agreements to acquire additional wastewater systems, which will add 213,000 retail customers or equivalent dwelling units. The pending deal includes the recently announced agreement with Integra Water LLC to acquire the wastewater system in Los Milagros, TX.

So far in 2024, the company’s regulated water segment has received rate awards or infrastructure surcharges of $51 million in Illinois, North Carolina, New Jersey, Texas, Virginia, Ohio and Pennsylvania. Its regulated natural gas segment has received infrastructure surcharges of $21.8 million in Kentucky and Pennsylvania.

WTRG’s Financial Highlights

Current assets were $373.9 million as of Sept. 30, 2024, compared with $492 million as of Dec. 31, 2023.

Long-term debt was $7.23 billion as of Sept. 30, 2024, higher than $6.82 billion as of Dec. 31, 2023.

The company invested $932.5 million in the first nine months of the year to improve its regulated water and natural gas infrastructure systems and to enhance operations and customer service.

Guidance of WTRG

Essential Utilities reaffirmed the 2024 EPS guidance range of $1.96-$2. The Zacks Consensus Estimate for EPS is pegged at $1.99.

Essential Utilities expects its 2025 EPS to be between $2.05 and $2.11. The Zacks Consensus Estimate for EPS is pegged at $2.12.

Management anticipates its customer base in the water segment to expand by 2-3% through acquisitions and organic customer growth.

The company plans to invest $1.4-$1.5 billion in its infrastructure in 2025. Essential Utilities also plans to invest $8 billion through 2025-2029 to improve the water and natural gas systems and better serve its customers using improved information technology.

WTRG plans to grow long-term earnings per share at a compounded annual growth rate of 5% to 7% for the three-year period through 2027.

WTRG’s Zacks Rank

Essential Utilities currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Releases

American Water Works Company AWK posted third-quarter 2024 operating EPS of $1.80, which lagged the Zacks Consensus Estimate of $1.84 by 2.2%. The bottom line improved 8.4% from the year-ago quarter's $1.66.

The Zacks Consensus Estimate for 2024 and 2025 earnings per share indicates year-over-year growth of 7.6% and 7.9%, respectively.

California Water Service Group CWT recorded third-quarter 2024 adjusted earnings of $1.03 per share, which lagged the Zacks Consensus Estimate of $1.09 by 5.5%. However, the bottom line increased from the year-ago quarter’s figure of 60 cents.

The Zacks Consensus Estimate for 2024 earnings per share implies year-over-year growth of 265.9%.

Middlesex Water MSEX came out with quarterly earnings of 80 cents per share, beating the Zacks Consensus Estimate of 67 cents. MSEX reported earnings of 56 cents per share a year ago.

The Zacks Consensus Estimate for 2024 and 2025 earnings per share suggests year-over-year growth of 25.6% and 6.8%, respectively.