We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
WTRG Q3 Earnings Surpass Estimates on Rate Recovery, Gas Growth
Read MoreHide Full Article
Key Takeaways
WTRG's Q3 adjusted EPS of 38 cents beats estimates by 8.57%, while revenues rise 6.6% to $508.3 million.
Water revenues rose 4.5%, while gas revenues jumped 13%, driven by rate recoveries and usage.
Essential plans $1.7B in 2026 infrastructure spending; American Water merger targets a Q1 2027 close.
Essential Utilities Inc. (WTRG - Free Report) reported third-quarter 2026 adjusted earnings of 38 cents per share, beating the Zacks Consensus Estimate of 35 cents by 8.57%.
GAAP earnings were 36 cents per share, up 9.1% from 33 cents a year ago.
Total Revenues
Quarterly revenues of $508.3 million surpassed the Zacks Consensus Estimate of $499 million by 1.86%. The top line increased 6.6% from $477 million in the prior-year quarter. Higher regulatory recoveries, increased purchased gas costs and stronger natural gas consumption supported revenue growth.
Essential Utilities Inc. Price, Consensus and EPS Surprise
Regulated water segment revenues totaled $380.6 million, up 4.5% from $364.1 million in the third quarter of 2025. Regulatory recoveries and additional revenues from a larger customer base were the primary growth drivers.
Regulated natural gas revenues increased 13% to $122.6 million from $108.5 million in the year-ago quarter. Higher rates and surcharges, increased purchase gas costs and favorable customer usage supported the segment's performance.
Essential's Profitability and Regulatory Growth
Total operations and maintenance expenses declined 0.6% year over year to $152.2 million from $153.1 million. Insurance recoveries and lower bad debt expenses in the natural gas segment contributed to the reduction, partially offset by increases in other expense categories.
Operating income rose 13.5% to $192.7 million from $169.8 million a year ago.
Interest expenses increased 10.9% year over year to $91.3 million from $82.3 million, reflecting higher financing costs.
Net income increased 12.8% to $103.8 million from $92.1 million in the year-ago quarter.
Essential secured rate awards and infrastructure surcharges during 2026, which are expected to increase annual water revenues by $53.6 million across Pennsylvania, Indiana, Illinois, Ohio, North Carolina and New Jersey. Natural gas rate recoveries in Pennsylvania and Kentucky are expected to contribute another $16.9 million annually.
WTRG Maintains Infrastructure Investment Momentum
Essential invested approximately $1.1 billion in regulated water and natural gas infrastructure during the first nine months of 2026. The company remains on track to invest $1.7 billion for the full year, focusing on system reliability and customer service improvements.
As of Sept. 30, 2026, net property, plant and equipment totaled $15.08 billion compared with $14.26 billion at the end of 2025. Long-term debt, excluding the current portion, declined to $8.03 billion from $8.11 billion.
The company had $759 million available under its credit lines, while the weighted average cost of fixed-rate long-term debt was 4.14%. Essential also declared a quarterly dividend of 36.06 cents per share, payable on Dec. 1, 2026, to shareholders of record as of Nov. 10.
Essential Advances Acquisitions and Merger Progress
The company has signed asset purchase agreements totaling approximately $290 million, covering more than 208,000 customers or equivalent dwelling units. These agreements include the $276.5 million DELCORA transaction in Pennsylvania. Its broader pipeline of potential municipal acquisitions represents approximately 400,000 customers.
Essential also continues progressing toward its proposed merger with American Water, which is expected to close in the first quarter of 2027. Regulatory approvals have been received in Kentucky, Ohio and Virginia, while settlement agreements in Pennsylvania, North Carolina and Texas remain subject to regulatory review and approval.
Evergy (EVRG - Free Report) is set to report third-quarter 2026 results on Nov. 5, before the market opens. The Zacks Consensus Estimate for earnings is pegged at $2.30 per share, which implies year-over-year growth of 13.30%.
EVRG’s long-term earnings growth rate is 9.07%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $1.90 billion, which implies a year-over-year improvement of 4.71%.
PPL Corporation (PPL - Free Report) is scheduled to report third-quarter 2026 results on Nov. 6, before the market opens. The Zacks Consensus Estimate for earnings is pegged at 53 cents per share, which implies year-over-year growth of 10.42%.
PPL’s long-term earnings growth rate is 5.26%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $2.44 billion, which implies a year-over-year improvement of 8.91%.
Consolidated Water (CWCO - Free Report) is scheduled to report third-quarter 2026 results on Nov. 9, after market close. The Zacks Consensus Estimate for earnings is pegged at 24 cents per share, which implies a year-over-year decline of 29.41%.
CWCO’s dividend yield is 2.04%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $32.62 million, which implies a year-over-year decrease of 7.12%.
View the Zacks #1 Rank List
Image: Bigstock
WTRG Q3 Earnings Surpass Estimates on Rate Recovery, Gas Growth
Key Takeaways
Essential Utilities Inc. (WTRG - Free Report) reported third-quarter 2026 adjusted earnings of 38 cents per share, beating the Zacks Consensus Estimate of 35 cents by 8.57%.
GAAP earnings were 36 cents per share, up 9.1% from 33 cents a year ago.
Total Revenues
Quarterly revenues of $508.3 million surpassed the Zacks Consensus Estimate of $499 million by 1.86%. The top line increased 6.6% from $477 million in the prior-year quarter. Higher regulatory recoveries, increased purchased gas costs and stronger natural gas consumption supported revenue growth.
Essential Utilities Inc. Price, Consensus and EPS Surprise
Essential Utilities Inc. price-consensus-eps-surprise-chart | Essential Utilities Inc. Quote
WTRG Segment Details
Regulated water segment revenues totaled $380.6 million, up 4.5% from $364.1 million in the third quarter of 2025. Regulatory recoveries and additional revenues from a larger customer base were the primary growth drivers.
Regulated natural gas revenues increased 13% to $122.6 million from $108.5 million in the year-ago quarter. Higher rates and surcharges, increased purchase gas costs and favorable customer usage supported the segment's performance.
Essential's Profitability and Regulatory Growth
Total operations and maintenance expenses declined 0.6% year over year to $152.2 million from $153.1 million. Insurance recoveries and lower bad debt expenses in the natural gas segment contributed to the reduction, partially offset by increases in other expense categories.
Operating income rose 13.5% to $192.7 million from $169.8 million a year ago.
Interest expenses increased 10.9% year over year to $91.3 million from $82.3 million, reflecting higher financing costs.
Net income increased 12.8% to $103.8 million from $92.1 million in the year-ago quarter.
Essential secured rate awards and infrastructure surcharges during 2026, which are expected to increase annual water revenues by $53.6 million across Pennsylvania, Indiana, Illinois, Ohio, North Carolina and New Jersey. Natural gas rate recoveries in Pennsylvania and Kentucky are expected to contribute another $16.9 million annually.
WTRG Maintains Infrastructure Investment Momentum
Essential invested approximately $1.1 billion in regulated water and natural gas infrastructure during the first nine months of 2026. The company remains on track to invest $1.7 billion for the full year, focusing on system reliability and customer service improvements.
As of Sept. 30, 2026, net property, plant and equipment totaled $15.08 billion compared with $14.26 billion at the end of 2025. Long-term debt, excluding the current portion, declined to $8.03 billion from $8.11 billion.
The company had $759 million available under its credit lines, while the weighted average cost of fixed-rate long-term debt was 4.14%. Essential also declared a quarterly dividend of 36.06 cents per share, payable on Dec. 1, 2026, to shareholders of record as of Nov. 10.
Essential Advances Acquisitions and Merger Progress
The company has signed asset purchase agreements totaling approximately $290 million, covering more than 208,000 customers or equivalent dwelling units. These agreements include the $276.5 million DELCORA transaction in Pennsylvania. Its broader pipeline of potential municipal acquisitions represents approximately 400,000 customers.
Essential also continues progressing toward its proposed merger with American Water, which is expected to close in the first quarter of 2027. Regulatory approvals have been received in Kentucky, Ohio and Virginia, while settlement agreements in Pennsylvania, North Carolina and Texas remain subject to regulatory review and approval.
WTRG’s Zacks Rank
Essential currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Evergy (EVRG - Free Report) is set to report third-quarter 2026 results on Nov. 5, before the market opens. The Zacks Consensus Estimate for earnings is pegged at $2.30 per share, which implies year-over-year growth of 13.30%.
EVRG’s long-term earnings growth rate is 9.07%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $1.90 billion, which implies a year-over-year improvement of 4.71%.
PPL Corporation (PPL - Free Report) is scheduled to report third-quarter 2026 results on Nov. 6, before the market opens. The Zacks Consensus Estimate for earnings is pegged at 53 cents per share, which implies year-over-year growth of 10.42%.
PPL’s long-term earnings growth rate is 5.26%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $2.44 billion, which implies a year-over-year improvement of 8.91%.
Consolidated Water (CWCO - Free Report) is scheduled to report third-quarter 2026 results on Nov. 9, after market close. The Zacks Consensus Estimate for earnings is pegged at 24 cents per share, which implies a year-over-year decline of 29.41%.
CWCO’s dividend yield is 2.04%. The Zacks Consensus Estimate for third-quarter 2026 sales is pinned at $32.62 million, which implies a year-over-year decrease of 7.12%.