California Water Service Group (CWT) vs Essential Utilities Inc. (WTRG)

California Water Service Group and Essential Utilities Inc. are both Utilities Regulated Water companies. Essential Utilities Inc. is the larger, with a market value of $11.3B against $2.8B — 4.0× the size. Essential Utilities Inc. trades at the lower P/E: 20.2× against 20.7×. Essential Utilities Inc. grew revenue faster over the last twelve months: 9.86% against 6.43%. Essential Utilities Inc. has the higher net margin (21.6% vs 12.6%) and the higher return on invested capital (3.63% vs 3.41%). Both pay a dividend; Essential Utilities Inc. yields more (3.40% vs 2.22%). Across the 22 metrics below, Essential Utilities Inc. leads on 16 and California Water Service Group on 6.

Valuation

Metric CWT WTRG Utilities Regulated Water median
P/E 20.70 20.17 20.64
P/S 2.64 4.37 4.37
P/B 1.54 1.60 1.91
Price to free cash flow n/m n/m —
EV/EBITDA 13.28 14.72 14.48
EV/Sales 4.15 7.67 6.20
Earnings yield 4.83% 4.96% 4.83%
Free cash flow yield (8.46%) (4.54%) (4.54%)

Profitability

Metric CWT WTRG Utilities Regulated Water median
Gross margin 68.05% 82.59% 71.91%
Operating margin 17.57% 35.06% 29.22%
Net margin 12.63% 21.60% 20.19%
Free cash flow margin (22.36%) (19.84%) (19.49%)
Return on equity 7.68% 8.08% 9.00%
Return on assets 2.35% 2.88% 3.21%
Return on invested capital 3.41% 3.63% 4.08%

Growth

Metric CWT WTRG Utilities Regulated Water median
Revenue growth (TTM) 6.43% 9.86% 6.92%
EPS growth (last fiscal year) (33.85%) 1.38% —
Revenue growth, 5-year CAGR 4.72% 11.09% 7.24%
Net income growth, 5-year CAGR 5.77% 16.69% 9.40%

Health

Metric CWT WTRG Utilities Regulated Water median
Debt to equity 0.93 1.21 0.93
Current ratio 0.70 0.78 1.01
Net debt to EBITDA 4.75 6.16 4.42

Dividend

Metric CWT WTRG Utilities Regulated Water median
Dividend yield 2.22% 3.40% 2.27%
Payout ratio 0.88 0.65 0.55

Size

Metric CWT WTRG Utilities Regulated Water median
Market cap 2.84b 11.28b 997.03m

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