Quenching a Thirst for Water Utilities

Last week, I mentioned leading several public company panels at the Las Vegas MoneyShow. I also mentioned that one of the companies that caught my eye was American Water Works (AWK) because of its core business -- 90% of its revenues come from regulated water utilities. All told, the company provides drinking water, wastewater services and other related services to an estimated 14 million people in more than 30 states, as well as parts of Canada.

What piqued my interest in the shares was the steady nature of the business, coupled with rate increases tied to capital spending to update and overhaul its water infrastructure, have allowed American Water Works to steadily increase its quarterly dividend. Including Pennsylvania, Iowa and California, American Water has approximately $135 million in requested additional revenues from formal rate cases, which should hit in the second half of 2013. That compares to quarterly revenue that ranges between $600 million and $850 million. Note that the $135 million is more than the revenue growth Wall Street expects the company to deliver in 2013 vs. 2012....375 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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