Essential Utilities (NYSE:WTRG) Posts Quarterly Earnings Results

Key Points

• Essential Utilities reported quarterly EPS of $0.83, missing analyst expectations of $0.90, even though revenue came in above estimates at $861.76 million and rose 10% year over year.
• The company said its merger with American Water is still on track, with the deal expected to close by the end of Q1 2027 after clearing key regulatory and shareholder approvals.
• Management reaffirmed its 5%–7% annual EPS growth target through 2027 and highlighted continued heavy investment in infrastructure, including plans for $1.7 billion of 2026 capital spending.

Essential Utilities (NYSE:WTRG - Get Free Report) released its quarterly earnings data on Thursday. The company reported $0.83 EPS for the quarter, missing the consensus estimate of $0.90 by ($0.07), Zacks reports. Essential Utilities had a net margin of 21.82% and a return on equity of 8.34%. The company had revenue of $861.76 million for the quarter, compared to the consensus estimate of $782.90 million. During the same period last year, the company earned $1.03 EPS. The firm's revenue for the quarter was up 10.0% on a year-over-year basis.

Here are the key takeaways from Essential Utilities' conference call:

• Company cleared a key regulatory milestone with the Kentucky Public Service Commission approval and earlier shareholder votes (95%), and management says the merger with American Water remains on track to close by end of Q1 2027 with active integration planning underway.
• Q1 GAAP EPS was $0.79 (including ~$0.04 of merger costs) and adjusted non‑GAAP EPS was $0.83, and management reaffirmed its 5%–7% annual EPS growth target through 2027 off a 2024 base of $1.97.
• Operationally they invested $269 million in Q1 and remain on track for $1.7 billion of 2026 capital spending to address PFAS/lead, reliability and safety (targeting 106 PFAS project completions) and are accelerating gas safety upgrades like Intelis meter installations.
• Acquisition program continues: closed the Greenville Water deal and has signed agreements adding about 201,000 customers for ~$285 million, with a broader pipeline of ~400,000 customers — though the DELCORA transaction remains stalled by a bankruptcy stay.
• Regulatory and political risk in Pennsylvania could pressure outcomes: the company booked $15.1 million of regulatory recoveries but has pending water/wastewater cases (~$102M annualized) and a Pennsylvania gas base rate case (~$163.2M), while the governor’s affordability initiative could complicate rate and merger reviews.

Essential Utilities Trading Down 0.7%

NYSE WTRG traded down $0.28 on Friday, hitting $37.43. 1,006,206 shares of the stock were exchanged, compared to its average volume of 2,545,093. The company has a debt-to-equity ratio of 1.21, a quick ratio of 0.65 and a current ratio of 0.95. The stock has a fifty day moving average price of $39.94 and a two-hundred day moving average price of $39.31. The firm has a market capitalization of $10.60 billion, a P/E ratio of 19.00 and a beta of 0.67. Essential Utilities has a 52-week low of $36.32 and a 52-week high of $42.37.

Essential Utilities Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Monday, June 1st. Investors of record on Tuesday, May 12th will be given a $0.3426 dividend. The ex-dividend date is Tuesday, May 12th. This represents a $1.37 dividend on an annualized basis and a yield of 3.7%. Essential Utilities's dividend payout ratio (DPR) is currently 69.54%.

Analyst Upgrades and Downgrades

A number of equities analysts recently commented on the company. UBS Group set a $41.00 price target on Essential Utilities in a research note on Thursday. Argus raised Essential Utilities to a "strong-buy" rating in a report on Monday, March 23rd. Two equities research analysts have rated the stock with a Strong Buy rating, one has issued a Buy rating, five have issued a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, Essential Utilities has a consensus rating of "Hold" and an average target price of $42.40.

Institutional Investors Weigh In On Essential Utilities

Several institutional investors have recently made changes to their positions in the company. Compound Planning Inc. raised its position in Essential Utilities by 7.4% in the 4th quarter. Compound Planning Inc. now owns 11,613 shares of the company's stock worth $445,000 after purchasing an additional 803 shares during the period. Invesco Ltd. grew its stake in shares of Essential Utilities by 0.8% during the fourth quarter. Invesco Ltd. now owns 3,962,841 shares of the company's stock valued at $152,015,000 after buying an additional 33,292 shares during the last quarter. Corient Private Wealth LLC grew its stake in shares of Essential Utilities by 23.4% during the fourth quarter. Corient Private Wealth LLC now owns 50,792 shares of the company's stock valued at $1,935,000 after buying an additional 9,626 shares during the last quarter. Alpine Woods Capital Investors LLC raised its holdings in shares of Essential Utilities by 9.4% in the fourth quarter. Alpine Woods Capital Investors LLC now owns 82,933 shares of the company's stock worth $3,181,000 after buying an additional 7,119 shares during the period. Finally, Mercer Global Advisors Inc. ADV lifted its stake in shares of Essential Utilities by 7.5% during the 4th quarter. Mercer Global Advisors Inc. ADV now owns 54,880 shares of the company's stock worth $2,105,000 after acquiring an additional 3,845 shares during the last quarter. Institutional investors own 74.78% of the company's stock.

Essential Utilities Company Profile

Essential Utilities, Inc, formerly known as Aqua America, is a publicly traded water and natural gas utility holding company. Through its regulated water and wastewater subsidiaries, the company provides essential water services to residential, commercial and industrial customers. In addition, Essential Utilities delivers natural gas distribution services in Pennsylvania through its Peoples Gas subsidiary, offering integrated utility solutions under a unified corporate framework.

The company traces its roots to the Philadelphia Suburban Water Company, founded in 1886 to serve growing communities outside Philadelphia.

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