California Story

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CWT -- USA Stock  

USD 50.36  0.62  1.22%

Today we may see the proof that American States would recover much slower from the latest fall as its shares went up 0.51% to California Water's 3.3641%. As many millenniums are excited about utilities space, we are going to shadow both, California Water and American States as a potential short-horizon opportunity. We are going to break down some of the competitive aspects of both California and American.
Published over two weeks ago
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Should you trade your American States (NYSE:AWR) and California Water (NYSE:CWT) positions after an advance?
By analyzing existing technical and fundamental indicators between California Water and American, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in American with a short position in California Water. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. California Water has an asset utilization ratio of 31.7 percent. This implies that the company is making $0.32 for each dollar of assets. An increasing asset utilization means that California Water Service is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as California or American is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

UNDERSTANDING California Water dividends

A dividend is the distribution of a portion of California Water earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. California Water dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. California one year expected dividend income is about $0.48 per share.
California Water Dividend Yield is comparatively stable at the moment as compared to the past year. California Water reported Dividend Yield of 0.015 in 2019. Dividends per Basic Common Share is likely to gain to 0.81 in 2020, whereas Payment of Dividends and Other Cash Distributions is likely to drop (41 M) in 2020.
Last ReportedProjected for 2020
Payment of Dividends and Other Cash Distributions-38 M-41 M
Dividend Yield 0.015  0.0187 
Dividends per Basic Common Share 0.79  0.81 
Investing in dividend-paying stocks, such as California Water Service is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in California Water must own a stock before its ex-dividend date to receive its next dividend. This type of analysis is very useful when you want to generate a past dividend schedule and payout information for California Water. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

How important is California Water's Liquidity

California Water financial leverage refers to using borrowed capital as a funding source to finance California Water Service ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. California Water financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between California Water's total debt and its cash.

Correlation Between California and American States Water

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding California Water together with similar or unrelated positions with a negative correlation. For example, you can also add American States to your portfolio. If American States is not perfectly correlated to California Water it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When California Water for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down. Please check pair correlation details between CWT and AWR for more information.

What is driving California Water Investor Appetite?

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Lets now check California Water revenue. Based on the latest financial disclosure, California Water Service reported 710.46 M of revenue. This is 82.06% lower than that of the Utilities sector and significantly higher than that of the Utilities?Regulated Water industry. The revenue for all United States stocks is 92.47% higher than that of the firm. As for American States we see revenue of 477.84 M, which is much higher than that of the Utilities?Regulated Water

California710.46 Million
Sector0.0
American477.84 Million
710.5 M
California
Sector
477.8 M
American

California Water implied volatility may change after the gain

The mean deviation is down to 1.2 as of today. California Water Service exhibits very low volatility with skewness of 0.37 and kurtosis of 0.16. However, we advise investors to further study California Water Service technical indicators to make sure all market info is available and is reliable.

The Bottom Line

Whereas some other companies in the utilities?regulated water industry are either recovering or due for a correction, California may not be as strong as the others in terms of longer-term growth potentials. Taking everything into account, as of the 6th of November 2020, our final 30 days 'Buy-Sell' recommendation on the firm is Cautious Hold. We believe California Water is currently fairly valued with close to average odds of distress for the next two years.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Ellen Johnson do not own shares of California Water Service. Please refer to our Terms of Use for any information regarding our disclosure principles.

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