American Water Works (AWK) Up 1.9% Since Last Earnings Report: Can It Continue?

It has been about a month since the last earnings report for American Water Works (AWK). Shares have added about 1.9% in that time frame, underperforming the S&P 500.But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is American Water Works due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for American Water Works Company, Inc. before we dive into how investors and analysts have reacted as of late.American Water Works' Q2 Earnings Lag, Revenues Beat EstimatesAmerican Water Works Company posted second-quarter 2025 operating earnings per share (EPS) of $1.48, which lagged the Zacks Consensus Estimate of $1.49 by 0.7%.The bottom line improved 4.2% from the year-ago quarter's EPS of $1.42. The year-over-year improvement in earnings was due to increased revenues from the implementation of new rates in the Regulated Businesses and contributions from acquired assets.Total Revenues of American Water WorksTotal quarterly revenues of $1.27 billion surpassed the Zacks Consensus Estimate of $1.15 billion by 10.6%. The top line also increased 11% from the year-ago figure of $1.14 billion.American Water Works' Segmental DetailsRegulated businesses’ net revenues in the second quarter were $1.17 billion, up 11.4% year over year.Other’s net revenues in the second quarter were $92 million, up 6.5% year over year.Highlights of American Water Works' Q2 ReleaseTotal operating expenses for the second quarter were $787 million, up 12.4% from the year-ago quarter’s $700 million, due to an increase in operating and maintenance expenses.The operating income was $489 million, up 8.9% from the year-ago figure of $449 million.American Water Works continues to expand operations through acquisitions and organic means. As of June 30, 2025, the company added 7,600 customers through seven closed acquisitions. Another 20 pending acquisitions, when completed, will add 40,650 customers.New rates effective since Jan. 1, 2025, will increase revenues for the full year by $270 million. As of June 30, 2025, the pending rate cases, if approved without any changes, can increase revenues by another $126 million.Financial Highlights of American Water WorksCash and cash equivalents amounted to $94 million as of June 30, 2025, compared with $96 million as of Dec. 31, 2024. Total liquidity (including cash and credit) was $1.17 billion as of June 30, which is enough to meet near-term obligations.Total long-term debt was $12.28 billion as of June 30, 2025, down 1.9% from $12.51 billion as of Dec. 31, 2024.In the first half of 2025, cash flow from operating activities was $632 million compared with $727 million in the year-ago period. American Water Works invested $1.3 billion in the first half of 2025 to strengthen its existing operations.American Water Works' Long-Term GuidanceAmerican Water Works narrowed its 2025 EPS guidance to $5.70-$5.75 from the previous range of $5.65-$5.75. The Zacks Consensus Estimate of $5.71 per share is a tad lower than the midpoint of the company’s guided range. American Water Works reiterated long-term earnings and dividend growth in the range of 7-9%. The company plans to invest nearly $3.3 billion in 2025.American Water Works reiterated its long-term capital expenditure plan to strengthen and expand existing infrastructure. For 2025-2029, capital expenditure is expected in the range of $17-$18 billion and for 2025-3034 in the band of $40-$42 billion.How Have Estimates Been Moving Since Then?Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.VGM ScoresAt this time, American Water Works has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors.Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.Outlook American Water Works has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American Water Works Company, Inc. (AWK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks