American States Water: Not The Stability Your Portfolio Needs

Sep. 29, 2022 12:24 AM ETAmerican States Water Company (AWR)1 Comment
Jarco Vianen profile picture
Jarco Vianen
181 Followers

Summary

  • American States Water Company generates stable and reliable streams of revenue, which has translated to steady profit and dividend growth.
  • Investors have been well rewarded over the last decade, as the stock outperformed the S&P 500 index. However, this is mainly due to multiple expansion.
  • With interest rate projections still on the rise, I expect valuation multiples of this stock to revert to their long-term averages.
  • Investors should avoid American States Water Company at the current price level, as the stock will deliver low-single-digit returns at best.
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The investment thesis

Interest rate projections are still on the rise, causing most stock valuations to decline. Investors tend to look for safety and stability in uncertain times like these. While the business of American States Water Company (

This article was written by

Jarco Vianen profile picture
181 Followers
I’m an individual investor who is just sharing his insights to help you in your investment proces.My strategy is to buy high-quality dividend stocks at reasonable prices with the intention to hold them forever. In the proces, I always look for moats – abilities that give a business competitive advantages. I believe moats are essential for a business to generate great long-term returns.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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.

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