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Why Is American States Water (AWR) Down 3.1% Since the Last Earnings Report?
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It has been about a month since the last earnings report for American States Water Company (AWR - Free Report) . Shares have lost about 3.1% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock’s next earnings release, or is it 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 Earnings Meet Estimates in Q4
American States Water Company reported fourth-quarter 2016 earnings of $0.30 per share, in line with the Zacks Consensus Estimate. However, reported earnings were $0.01 lower from the year-ago figure of $0.31. The year-over-year decline was primarily due to lower contribution from the Water segment.
Full-year 2016 earnings of $1.62 per share were 1.2% lower than the Zacks Consensus Estimate of $1.64. However, the earnings exceeded the 2015 figure by 1.3%. Full-year earnings improved primarily on the back of better contribution of the Electric segment.
Revenues
American States Water's operating revenues in the quarter were $106.8 million, which lagged the Zacks Consensus Estimate of $109 million by 2.01%. Further, revenues decreased nearly 3.0% year over year.
Full-year 2016 total revenue was $436.1 million, down 4.9% from $458.6 million reported in 2015. Additionally, total revenue was 3.3% lower than the Zacks Consensus Estimate of $451.0 million.
Operational Update
In the quarter under review, American States Water's total operating expenses were $84.7 million, down 4.0% year over year. Interest expenses were $5.1 million, up 4.1%.
Operating income in the reported quarter was $22.1 million, up marginally from $21.9 million reported in the year-ago quarter.
Net income was $11.2 million, down 3.5% from the prior-year quarter.
Segment Details
The Water segment's earnings during the quarter came in at $0.13, down 31.6% year over year. Earnings for the fourth quarter reflect the retroactive impact of new water rates on American States Water's subsidiary, Golden State Water Company, in the first nine months of 2016, which reduced the earnings by 8 cents in the reported quarter.
The Electric segment's earnings during the quarter amounted to $0.04, up 33.3% year over year.
The Contracted Services segment's earnings improved 44.4% year over year to $0.13.
Financial Update
As of Dec 31, 2016, American States Water's cash and cash equivalents were $0.03 million compared with $0.8 million as of Dec 31, 2015.
As of Dec 31, 2016, long-term debts were $320.9 million, flat with the year-ago levels.
Net cash from operating activities in 2016 was $96.9 million, up from $95.1 million in the year-ago period.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one downard revision for the current quarter. In the past month, the consensus estimate also shifted downward by 5.9% due to these changes.
At this time, American States Water's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% 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.
The stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Interestingly, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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Why Is American States Water (AWR) Down 3.1% Since the Last Earnings Report?
It has been about a month since the last earnings report for American States Water Company (AWR - Free Report) . Shares have lost about 3.1% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock’s next earnings release, or is it 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 Earnings Meet Estimates in Q4
American States Water Company reported fourth-quarter 2016 earnings of $0.30 per share, in line with the Zacks Consensus Estimate. However, reported earnings were $0.01 lower from the year-ago figure of $0.31. The year-over-year decline was primarily due to lower contribution from the Water segment.
Full-year 2016 earnings of $1.62 per share were 1.2% lower than the Zacks Consensus Estimate of $1.64. However, the earnings exceeded the 2015 figure by 1.3%. Full-year earnings improved primarily on the back of better contribution of the Electric segment.
Revenues
American States Water's operating revenues in the quarter were $106.8 million, which lagged the Zacks Consensus Estimate of $109 million by 2.01%. Further, revenues decreased nearly 3.0% year over year.
Full-year 2016 total revenue was $436.1 million, down 4.9% from $458.6 million reported in 2015. Additionally, total revenue was 3.3% lower than the Zacks Consensus Estimate of $451.0 million.
Operational Update
In the quarter under review, American States Water's total operating expenses were $84.7 million, down 4.0% year over year. Interest expenses were $5.1 million, up 4.1%.
Operating income in the reported quarter was $22.1 million, up marginally from $21.9 million reported in the year-ago quarter.
Net income was $11.2 million, down 3.5% from the prior-year quarter.
Segment Details
The Water segment's earnings during the quarter came in at $0.13, down 31.6% year over year. Earnings for the fourth quarter reflect the retroactive impact of new water rates on American States Water's subsidiary, Golden State Water Company, in the first nine months of 2016, which reduced the earnings by 8 cents in the reported quarter.
The Electric segment's earnings during the quarter amounted to $0.04, up 33.3% year over year.
The Contracted Services segment's earnings improved 44.4% year over year to $0.13.
Financial Update
As of Dec 31, 2016, American States Water's cash and cash equivalents were $0.03 million compared with $0.8 million as of Dec 31, 2015.
As of Dec 31, 2016, long-term debts were $320.9 million, flat with the year-ago levels.
Net cash from operating activities in 2016 was $96.9 million, up from $95.1 million in the year-ago period.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one downard revision for the current quarter. In the past month, the consensus estimate also shifted downward by 5.9% due to these changes.
American States Water Company Price and Consensus
American States Water Company Price and Consensus | American States Water Company Quote
VGM Scores
At this time, American States Water's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. However, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% 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.
The stock is suitable solely for momentum based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Interestingly, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.