📊 AWK Key Takeaways
Investment Thesis
American Water Works demonstrates solid operational profitability with 36.7% operating margins and strong revenue growth of 10.1% YoY, reflecting stable utility demand. However, significant capital intensity with negative free cash flow of -1.1B and high leverage (1.32x debt/equity) constrain financial flexibility and raise sustainability concerns regarding dividend coverage and growth investments.
AWK Strengths
- Strong revenue growth of 10.1% YoY indicating market expansion and pricing power
- High operating margin of 36.7% and net margin of 21.7% demonstrating operational efficiency
- Solid interest coverage ratio of 8.2x providing adequate debt servicing capacity
- Consistent operating cash flow generation of 2.1B supporting capital investments
AWK Risks
- Negative free cash flow of -1.1B with capital expenditures (3.1B) exceeding operating cash flow, indicating dependence on external financing
- High leverage with debt-to-equity ratio of 1.32x and 14.3B long-term debt limiting financial flexibility
- Critically low current ratio of 0.46x suggesting potential short-term liquidity stress and working capital management concerns
- Minimal cash reserves (98M) relative to debt obligations and capital needs creates refinancing risk
- Flat net income growth (0.0% YoY) despite 10.1% revenue growth indicating margin compression or one-time charges
Key Metrics to Watch
- Free cash flow trends and capital expenditure requirements relative to operating cash generation
- Debt-to-equity ratio and refinancing activities in capital markets
- Operating margin sustainability amid rate regulation and input cost pressures
- Current ratio improvement and working capital management
AWK Financial Metrics
💡 AI Analyst Insight
The current ratio below 1.0x warrants monitoring of short-term liquidity.
AWK Profitability Ratios
AWK vs Default Sector
How American Water Works Company, Inc. compares to Default sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
AWK Balance Sheet & Liquidity
AWK 5-Year Financial Trend
5-Year Trend Summary: American Water Works Company, Inc.'s revenue has grown significantly by 31% over the 5-year period, indicating strong business expansion. The most recent EPS of $4.90 reflects profitable operations.
AWK Growth Metrics (YoY)
AWK Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $1.3B | $185.0M | $1.80 |
| Q2 2025 | $1.1B | $185.0M | $1.42 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
AWK Capital Allocation
AWK SEC Filings
Access official SEC EDGAR filings for American Water Works Company, Inc. (CIK: 0001410636)
📋 Recent SEC Filings
❓ Frequently Asked Questions about AWK
What is the AI rating for AWK?
American Water Works Company, Inc. (AWK) has an AI rating of HOLD with 62% confidence, based on fundamental analysis of SEC EDGAR filings.
What are AWK's key strengths?
Strong revenue growth of 10.1% YoY indicating market expansion and pricing power. High operating margin of 36.7% and net margin of 21.7% demonstrating operational efficiency.
What are the risks of investing in AWK?
Negative free cash flow of -1.1B with capital expenditures (3.1B) exceeding operating cash flow, indicating dependence on external financing. High leverage with debt-to-equity ratio of 1.32x and 14.3B long-term debt limiting financial flexibility.
What is AWK's revenue and growth?
American Water Works Company, Inc. reported revenue of $5.1B.
Does AWK pay dividends?
American Water Works Company, Inc. pays dividends, with $633.0M distributed to shareholders in the trailing twelve months.
Where can I find AWK SEC filings?
Official SEC filings for American Water Works Company, Inc. (CIK: 0001410636) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is AWK's EPS?
American Water Works Company, Inc. has a diluted EPS of $5.69.
How is the AI analysis conducted?
Our AI (Claude) analyzes publicly available SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports to evaluate financial health, profitability ratios, balance sheet strength, and growth metrics.