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Comparing Aqua America To Its Peers And Other Utilities


  • Aqua America is a growing utility company that has shown impressive dividend growth and consistently good revenue and net income performance.
  • The company recently posted good third-quarter net income results, but missed on revenue.
  • It appears the revenue miss was the result of short-term developments, while the longer term prospects still appear very positive.
  • Overall, Aqua America tops its peers in a number of categories that are of interest to DG investors.

Aqua America (WTR) is a large U.S.-based water utility company, serving nearly 3 million people in Pennsylvania, Ohio, North Carolina, Illinois, Texas. It is considered a good dividend growth stock by many investors due to its consistent price and dividend growth over several decades. Specifically, Aqua America has increased its dividend for over 25 straight years, and its more recent five-year dividend growth rate tops 8.4%, which demonstrates the strong underlying financial condition of the company.

As an investor focused on long-term dividend growth, I have recently invested in WTR stock because of its track history, future prospects, and impressive financial metrics. You can see the metrics I use to analyze companies for my personal portfolio here.

For those who like a good long-term thesis before investing, the water utilities sector has a lot of potential in the coming decades, primarily because many geographic areas in the U.S. increasingly require more or better water infrastructure - as a result of droughts, water shortages, and/or the need for overall improvements to water infrastructure. Aqua America is thus in a great position to capitalize, primarily through increasing its customer base. In fact, WTR has substantially increased its customer base in the recent past, primarily through a number of acquisitions.

Aqua America's Consistent Net Income Gains

A quick look at WTR's net income growth over the past decade shows just how consistent the company has been in increasing its bottom line.

ChartWTR Net Income (Annual) data by YCharts

While there is a slight dip around 2015, WTR's net income is increasing at a nice, steady pace, and has more than doubled over the past decade.

How Aqua America Has and Will Continue to Consistently Drive Growth

Aqua America's recent past shows us they are driving growth through acquisition, including recent acquisition of three public

This article was written by

I began trading stocks in 2010, but sold all of my equities in order to help pay the costs of attending law school. Now that I am a working professional, I have decided to invest in dividend growth stocks. To do this, I put away a certain amount of my bi-monthly paycheck into my own stock portfolio. This is separate from my Roth IRA, which is invested according to the advice of my Certified Financial Planner. My goal is the following: to grow my personal stock portfolio to the point where the dividends coming in can replace my paycheck. While replacing my salary with dividends does not mean I will stop working, it does mean, at least for me, that I have attained true financial freedom. My dividend growth portfolio will also be tested against my two other investments: 1) my professionally handled Roth IRA; and 2) my real estate investments. Only time will tell which of these 3 investments will be the best for me.

Analyst’s Disclosure: I am/we are long WTR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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