Global Water Resources (NASDAQ:GWRS – Get Free Report) and American Water Works (NYSE:AWK – Get Free Report) are both utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, profitability and institutional ownership.
Institutional & Insider Ownership
27.9% of Global Water Resources shares are owned by institutional investors. Comparatively, 86.6% of American Water Works shares are owned by institutional investors. 53.7% of Global Water Resources shares are owned by company insiders. Comparatively, 0.1% of American Water Works shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Analyst Recommendations
This is a breakdown of current recommendations for Global Water Resources and American Water Works, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Global Water Resources | 1 | 2 | 0 | 0 | 1.67 |
| American Water Works | 1 | 7 | 2 | 0 | 2.10 |
Global Water Resources presently has a consensus price target of $15.00, indicating a potential upside of 119.14%. American Water Works has a consensus price target of $144.12, indicating a potential downside of 2.97%. Given Global Water Resources’ higher probable upside, analysts plainly believe Global Water Resources is more favorable than American Water Works.
Dividends
Global Water Resources pays an annual dividend of $0.30 per share and has a dividend yield of 4.4%. American Water Works pays an annual dividend of $3.58 per share and has a dividend yield of 2.4%. Global Water Resources pays out 375.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. American Water Works pays out 62.0% of its earnings in the form of a dividend. Global Water Resources has raised its dividend for 8 consecutive years and American Water Works has raised its dividend for 18 consecutive years.
Profitability
This table compares Global Water Resources and American Water Works’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Global Water Resources | 3.98% | 2.06% | 0.37% |
| American Water Works | 21.26% | 10.14% | 3.19% |
Risk and Volatility
Global Water Resources has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, American Water Works has a beta of 0.56, suggesting that its share price is 44% less volatile than the S&P 500.
Earnings and Valuation
This table compares Global Water Resources and American Water Works”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Global Water Resources | $60.90 million | 3.36 | $2.96 million | $0.08 | 85.56 |
| American Water Works | $5.14 billion | 5.75 | $1.11 billion | $5.77 | 25.74 |
American Water Works has higher revenue and earnings than Global Water Resources. American Water Works is trading at a lower price-to-earnings ratio than Global Water Resources, indicating that it is currently the more affordable of the two stocks.
Summary
American Water Works beats Global Water Resources on 12 of the 17 factors compared between the two stocks.
About Global Water Resources
Global Water Resources, Inc. (NASDAQ: GWRS) is a water resource management company that owns and operates regulated water, wastewater and recycled water utilities in Arizona. The company provides essential services to residential, commercial and industrial customers, including the delivery of potable water, collection and treatment of wastewater, and the production and distribution of recycled water. Global Water Resources serves communities primarily in the Phoenix metropolitan area and other growing areas of central and southern Arizona.
About American Water Works
American Water Works Company, Inc. is a U.S. water and wastewater utility that provides services to residential, commercial, industrial, and public-sector customers. Its operations include treating and distributing drinking water, collecting and treating wastewater, and maintaining the infrastructure needed to deliver those services. The company operates regulated water and wastewater utilities across multiple states, serving communities in regions including the Northeast, Midwest, and South. Through contracted operations, it also provides water and wastewater services to certain military installations and municipal customers.
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