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California Water Service Group (CWT) vs H2O America (HTO)

California Water Service Group and H2O America are both Utilities Regulated Water companies. California Water Service Group is the larger, with a market value of $2.9B against $2.4B — 1.2× the size. H2O America trades at the lower P/E: 20.2× against 20.8×. California Water Service Group grew revenue faster over the last twelve months: 6.43% against 5.04%. H2O America has the higher net margin (12.9% vs 12.6%) and the lower return on invested capital (3.06% vs 3.41%). Both pay a dividend; H2O America yields more (3.02% vs 2.81%). Across the 22 metrics below, California Water Service Group leads on 12 and H2O America on 10.

Valuation

Metric CWT HTO Utilities Regulated Water median
P/E 20.79 20.17 20.81
P/S 2.65 2.91 4.51
P/B 1.55 1.31 1.96
Price to free cash flow n/m n/m —
EV/EBITDA 13.32 13.72 14.30
EV/Sales 4.16 5.07 6.15
Earnings yield 4.81% 4.96% 4.80%
Free cash flow yield (8.42%) (11.29%) (4.40%)

Profitability

Metric CWT HTO Utilities Regulated Water median
Gross margin 68.05% 60.99% 71.91%
Operating margin 17.57% 21.48% 29.22%
Net margin 12.63% 12.91% 20.19%
Free cash flow margin (22.36%) (32.90%) (19.49%)
Return on equity 7.68% 6.46% 9.00%
Return on assets 2.35% 2.08% 3.21%
Return on invested capital 3.41% 3.06% 4.08%

Growth

Metric CWT HTO Utilities Regulated Water median
Revenue growth (TTM) 6.43% 5.04% 6.92%
EPS growth (last fiscal year) (33.85%) 1.74% 1.38%
Revenue growth, 5-year CAGR 4.72% 7.24% 7.24%
Net income growth, 5-year CAGR 5.77% 10.77% 9.40%

Health

Metric CWT HTO Utilities Regulated Water median
Debt to equity 0.93 1.03 0.93
Current ratio 0.70 1.67 1.01
Net debt to EBITDA 4.75 6.57 4.42

Dividend

Metric CWT HTO Utilities Regulated Water median
Dividend yield 2.81% 3.02% 2.81%
Payout ratio 0.59 0.61 0.57

Size

Metric CWT HTO Utilities Regulated Water median
Market cap 2.85b 2.40b 1.02b

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