The York Water (NASDAQ: YORW) and Consolidated Water Co. (NASDAQ:CWCO) are both small-cap utilities companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.
Volatility and Risk
The York Water has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Consolidated Water Co. has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500.
The York Water pays an annual dividend of $0.64 per share and has a dividend yield of 2.0%. Consolidated Water Co. pays an annual dividend of $0.30 per share and has a dividend yield of 2.4%. The York Water pays out 68.8% of its earnings in the form of a dividend. Consolidated Water Co. pays out 150.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This is a breakdown of current ratings and recommmendations for The York Water and Consolidated Water Co., as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The York Water||0||0||0||0||N/A|
|Consolidated Water Co.||0||0||1||0||3.00|
Consolidated Water Co. has a consensus price target of $15.00, indicating a potential upside of 21.46%. Given Consolidated Water Co.’s higher probable upside, analysts plainly believe Consolidated Water Co. is more favorable than The York Water.
Institutional & Insider Ownership
34.7% of The York Water shares are held by institutional investors. Comparatively, 51.4% of Consolidated Water Co. shares are held by institutional investors. 1.1% of The York Water shares are held by insiders. Comparatively, 3.2% of Consolidated Water Co. shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This table compares The York Water and Consolidated Water Co.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The York Water||25.05%||10.52%||3.73%|
|Consolidated Water Co.||4.98%||5.41%||5.07%|
Earnings and Valuation
This table compares The York Water and Consolidated Water Co.’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|The York Water||$48.03 million||8.76||$28.97 million||$0.93||35.22|
|Consolidated Water Co.||$59.39 million||3.10||$12.82 million||$0.20||61.75|
The York Water has higher revenue, but lower earnings than Consolidated Water Co.. The York Water is trading at a lower price-to-earnings ratio than Consolidated Water Co., indicating that it is currently the more affordable of the two stocks.
Consolidated Water Co. beats The York Water on 9 of the 15 factors compared between the two stocks.
About The York Water
The York Water Company is an investor-owned water utility in the United States. The primary business of the Company is to impound, purify to meet or exceed safe drinking water standards and distribute water. As of December 31, 2016, it also owned and operated three wastewater collection systems and two wastewater treatment systems. As of December 31, 2016, it operated within its territory, which covered 39 municipalities within York County, Pennsylvania and nine municipalities within Adams County, Pennsylvania. Its two wastewater treatment facilities are located in East Manchester and Lower Windsor Townships. It provides sewer billing services. It has a service line protection program, which allows customers to pay a fixed monthly fee, and it will repair or replace damaged customer service lines. As of December 31, 2016, it obtained the bulk of its water supply from both the South Branch and East Branch of the Codorus Creek, which together had a daily flow of 73 million gallons.
About Consolidated Water Co.
Consolidated Water Co. Ltd. develops and operates seawater desalination plants (that utilize reverse osmosis technology) and water distribution systems in areas where naturally occurring supplies of potable water are scarce or non-existent. The Company operates in three segments: retail water operations, bulk water operations and services operations. The retail water operations segment produces and supplies water to end users, including residential, commercial and government customers. The bulk water operations segment produces potable water from seawater and sells this water to governments and private customers. The services operations segment provides engineering and management services, including designing and constructing desalination plants, and managing and operating plants owned by affiliated companies. Through its subsidiaries and affiliates, it provides various services to its customers in the Cayman Islands, The Bahamas, Belize, the British Virgin Islands and Indonesia.
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