| Over a week ago | ||||
As previously reported,… As previously reported, Wells Fargo analyst Jonathan Reeder downgraded American States Water (AWR) to Equal Weight from Overweight with a $98 price target. The analyst is reshuffling his ratings on the California-based water utilities following some recent price volatility and reflecting on his NAWC meetings as well as California Water Service's (CWT) and SJW Group's (SJW) Q3 updates late last week. Although Reeder believes the current P/E hierarchy makes sense - American States Water trades at a premium to CWT which trades at a premium to SJW -, he thinks SJW Group's discount has simply grown too steep, American States Water's upside is no longer enough to warrant an Overweight, and California Water Service's upside is the most limited of the three. The analyst also double upgraded SJW to Overweight from Underweight with a price target of $76, up from $70. | ||||
As previously reported,… As previously reported, Wells Fargo analyst Jonathan Reeder upgraded SJW Group (SJW) to Overweight from Underweight with a price target of $76, up from $70. The analyst is reshuffling his ratings on the California-based water utilities following some recent price volatility and reflecting on his NAWC meetings as well as California Water Service's (CWT) and SJW's Q3 updates late last week. Although Reeder believes the current P/E hierarchy makes sense - American States Water (AWR) trades at a premium to CWT which trades at a premium to SJW -, he thinks SJW's discount has simply grown too steep, American States Water's upside is no longer enough to warrant an Overweight, and California Water Service's upside is the most limited of the three. The analyst also downgraded American States Water to Equal Weight from Overweight, with a price target of $98. | ||||
| Over a month ago | ||||
Reports Q3 revenue… Reports Q3 revenue $256.72M, two est. $334.83M. According to President and Chief Executive Officer Martin A. Kropelnicki, third quarter results were in line with the Company's expectations. He said the company continued to focus on its responses to the drought and the pandemic, particularly in the areas of supporting customers, keeping employees safe, and procuring equipment and materials well in advance to avoid having supply chain issues impact investment in water system infrastructure. "I am extremely pleased with our efforts to help customers who've been impacted by Covid-19 get access to government relief funds. On behalf of our California customers, we requested $16.9 million from the State of California's Water Arrearage Payment Program to pay customer delinquent account balances as of June 15, 2021. This is one of the many ways we've shown our commitment to supporting our customers and communities during these difficult times," Kropelnicki said. | ||||
| Over a quarter ago | ||||
California Water Service,… California Water Service, the largest subsidiary of California Water Service Group, received approval late last week from the California Public Utilities Commission to acquire the water and wastewater systems serving the Preserve at Millerton and provide regulated water and wastewater service to its future customers. The Preserve at Millerton is a new 1,400-unit master-planned, mixed-use community in Madera County that will include residences, commercial and office space, parks, community facilities, and associated infrastructure. The transaction, expected to close when residences are ready to be occupied in 2022, is subject to the completion of conditions in the purchase agreement. "We appreciate the diligence by the CPUC in reviewing this transaction and look forward to serving the residents and businesses at the Preserve at Millerton," said Group President and Chief Executive Officer Martin A. Kropelnicki. "We also look forward to watching this region grow and thrive, and providing the same quality, service, and value that we are committed to delivering to all of our customers in California." | ||||
California Water Service,… California Water Service, the largest subsidiary of California Water Service Group, received approval late last week from the California Public Utilities Commission to acquire the water and wastewater systems serving the Preserve at Millerton and provide regulated water and wastewater service to its future customers. The Preserve at Millerton is a new 1,400-unit master-planned, mixed-use community in Madera County that will include residences, commercial and office space, parks, community facilities, and associated infrastructure. The transaction, expected to close when residences are ready to be occupied in 2022, is subject to the completion of conditions in the purchase agreement. "We appreciate the diligence by the CPUC in reviewing this transaction and look forward to serving the residents and businesses at the Preserve at Millerton," said Group President and Chief Executive Officer Martin A. Kropelnicki. "We also look forward to watching this region grow and thrive, and providing the same quality, service, and value that we are committed to delivering to all of our customers in California." | ||||
Reports Q2 revenue… Reports Q2 revenue $213.1M, consensus $202.09M. According to President and Chief Executive Officer Martin A. Kropelnicki, second quarter results were in line with the Company's expectations. "I am particularly pleased with second quarter efforts to finalize our California Infrastructure Improvement Plans and General Rate Case for calendar years 2023 through 2025, which were filed on July 1, as well as our reactivation of the drought response team that helped make us a leader during the last California drought," he said. As announced, Cal Water submitted its 2022-2024 infrastructure improvement plans in its General Rate Case filing with the CPUC. In the filing, Cal Water requested approval to invest $1.02 billion over the three-year period in water system infrastructure. The filing also included a new rate design. "We knew that without the Water Revenue Adjustment Mechanism (WRAM), which decouples water sales and revenues, we would need a new, innovative rate design that provides reasonable revenue stability while protecting low-income and low-water-using customers. The filing reflects our commitment to making the water system improvements that are critical to reliability and safety without losing sight of need for affordability," Kropelnicki said. | |
California Water Service… California Water Service yesterday submitted its 2022-2024 infrastructure improvement plans for all of its California districts in its General Rate Case filing with the California Public Utilities Commission. The proposal also contains proposed new rate designs, which seek to balance revenue stability with reduced customer impacts, especially for low-income and water-saving customers. The CPUC will analyze the infrastructure improvement plans, operating budget proposals, and rate designs to establish water rates that reflect the actual cost of service, effective no earlier than January 2023. Cal Water proposes to invest $1.02B over the period of 2022-2024. Included in the proposal are $913.1M of newly proposed capital investments along with continued funding for capital projects begun in 2021 or earlier. Almost half of Cal Water's proposed new infrastructure improvements are to replace aging water pipelines, which will enhance reliability and augment water supplies to support customers' and firefighters' needs. The plans also include, among others, upgrades to withstand power outages and Public Safety Power Shutoff events, protect customers from known and emerging water contaminants, and expand water supplies to ensure sustainability and wildfire hardening. The cost of these upgrades are expected to be offset by the utility's continuing refinements to its operating model to improve service and reduce costs. In another part of the filing, Cal Water proposed rate design changes that would improve revenue stability but provide a discounted unit rate to the first six units of water per month for residential customers. In the proposal, this block of usage would be charged at 25% of the average rate. The CPUC has recognized this six-unit block as essential for basic needs. The required filing begins an approximately 18-month review process by the CPUC, an independent state agency, during which it determines approved projects and sets rates for the following three years. Any changes in customer rates would become effective no sooner than January 2023. Cal Water has proposed to the CPUC to increase revenues by $80.5M, or 11.1%, in 2023; $43.6M, or 5.4%, in 2024; and $43.2M, or 5.1%, in 2025 to support these investments. If approved as filed, this would cost the average residential customer less than an additional $5 per month in all of Cal Water's service areas. | |
Hawaii Water Service… Hawaii Water Service announced that it has signed an agreement to acquire the assets of HOH Utilities Company, a wastewater utility located in the growing Poipu/Koloa area of Kauai County on the island of Kauai. The acquisition is subject to satisfaction of customary closing conditions, including approval by the Hawaii Public Utilities Commission. As part of the purchase from Mr. Ian Kagimoto, Hawaii Water will own and manage the wastewater utility, which currently serves almost 1,800 residential, commercial, and resort customers in Poipu and Koloa, including three hotels, condominiums, multi-family housing, a golf course, and single-family homes. | |
California Water Service… California Water Service Group announced that its new subsidiary, TWSC, or Texas Water Service, now owns the majority of BVRT Utility, a Texas-based utility development company owning and operating four wastewater utilities serving growing communities outside of Austin and San Antonio. Texas Water Service initially invested funds to enable BVRT to continue to build wastewater infrastructure. Today it converted its investment to equity, with the intention of continuing to invest in BVRT's existing infrastructure and new developments, and has the right to eventually acquire all of BVRT's growing portfolio of wastewater systems. BVRT's four wastewater utilities currently serve or are under contract to serve over 2,500 connections, with a potential total build-out of more than 61,000 connections. Texas Water Service, through its partnership with BVRT, is actively and aggressively pursuing additional opportunities to build and enhance wastewater infrastructure. | |
Reports Q1 revenue… Reports Q1 revenue $147.74M, consensus $69.67M. According to president and CEO Martin Kropelnicki, the results are in line with the company's expectations. "2021 is shaping up to be a busy year, particularly on the regulatory front. We are on track to file California's GRC for calendar years 2023 through 2025 during the second quarter of 2021, in accordance with the CPUC's Rate Case Plan. In addition, at the request of the CPUC, we are filing an application next week in a proceeding that will set our cost of capital for 2022 through 2024. We expect this proceeding to conclude prior to yearend. And finally, we are working with the California Public Utilities Commission to find solutions for customers who haven't been able to pay their bills during the pandemic," Kropelnicki said. |
