Latest news with #WaterUtilities
Yahoo
19 hours ago
- Climate
- Yahoo
UPDATE: Normal operations resume at Nacogdoches water plant following repairs
UPDATE: The City of Nacogdoches said power systems at the surface water treatment plant have been repaired. City Manager Rick Beverlin, thanks the repair teams for their quick actions and residents for participating in water conservation efforts. NACOGDOCHES, Texas (KETK) — City of Nacogdoches residents and businesses are encouraged to conserve water following a lightning strike that is causing electrical issues at the city's surface water treatment plant. Rep. Moran introduces bill to improve rural radar gaps in East Texas The City of Nacogdoches released a statement concerning a lightning strike that affected a transformer at the surface water treatment plant on Friday night. The Water Utilities Department is asking the community to avoid unnecessary water usage for an estimated 48 hours. State Rep. Jay Dean announces plan for reelection campaign The city said crews are currently working to supply supplemental power while the transformer is being repaired. Updates will be provided as the status of the situation develops. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
2 days ago
- Business
- Yahoo
Should You Be Concerned About H2O America's (NASDAQ:HTO) ROE?
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). We'll use ROE to examine H2O America (NASDAQ:HTO), by way of a worked example. ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In short, ROE shows the profit each dollar generates with respect to its shareholder investments. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. ROE can be calculated by using the formula: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for H2O America is: 7.1% = US$99m ÷ US$1.4b (Based on the trailing twelve months to March 2025). The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.07 in profit. See our latest analysis for H2O America Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As is clear from the image below, H2O America has a lower ROE than the average (8.9%) in the Water Utilities industry. Unfortunately, that's sub-optimal. However, a low ROE is not always bad. If the company's debt levels are moderate to low, then there's still a chance that returns can be improved via the use of financial leverage. A high debt company having a low ROE is a different story altogether and a risky investment in our books. To know the 2 risks we have identified for H2O America visit our risks dashboard for free. Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. It's worth noting the high use of debt by H2O America, leading to its debt to equity ratio of 1.33. With a fairly low ROE, and significant use of debt, it's hard to get excited about this business at the moment. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it. Return on equity is one way we can compare its business quality of different companies. In our books, the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to take a peek at this data-rich interactive graph of forecasts for the company. Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Daily Mail
17-06-2025
- Business
- Daily Mail
Ban Chinese companies from investing in British water utilities, ministers urged
Ministers are being urged to block Chinese firms from investing in water utilities after they were banned from involvement with the Sizewell C nuclear plant. Environment Secretary Steve Reed has been warned that allowing companies based in China or Hong Kong to buy crucial utilities would be 'negligent'. Energy Secretary Ed Miliband last week banned Chinese investment in the Sizewell C nuclear plant amid growing concerns over the country's involvement in key UK infrastructure. And it followed demands from CKI, which is owned by Hong Kong billionaire Li-Ka-shing and already holds a majority stake in Northumbrian Water, to be allowed to bid for Thames Water. The struggling utility was plunged further into crisis earlier this month after American private equity giant KKR – the Government's preferred bidder – abandoned a £4bn rescue plan. KKR's U-turn – which sources said was due to concerns about the risk of political interference – fuelled fears that taxpayers could be forced to bail out Britain's biggest water company. Environment Secretary Steve Reed has been warned that allowing companies based in China or Hong Kong to buy crucial utilities would be 'negligent' Tory MP Nick Timothy said Chinese companies should not be allowed to invest in Thames Water. In a letter to Reed, seen by the Mail, Timothy said Miliband's decision was 'correct, given the threat posed by China to the UK and the wider west'. He said: 'It would be negligent to hand over yet more of our critical national infrastructure on top of China's already extensive footprint. 'In light of the Government's ban on Chinese investment in nuclear power, will you impose a similar ban on further Chinese investment in the water sector?' Companies in mainland China 'are under various obligations to the Chinese state, such as requirements to support, assist and cooperate with national intelligence efforts', he said. He argued that those based in Hong Kong 'also pose a serious risk, since they are now subject to authoritarian National Security Laws which have increased Beijing's reach into the territory'.
E&E News
04-06-2025
- Politics
- E&E News
EPA seeks more time on PFAS water rule
EPA is still evaluating how it plans to regulate 'forever chemicals' in drinking water, a process that has taken 'longer than anticipated,' the Trump administration said in a court filing Wednesday. The agency is asking the U.S. Court of Appeals for the District of Columbia Circuit for another 45-day pause in litigation challenging last year's first-ever national drinking water rule for per- and polyfluoroalkyl substances, or PFAS. EPA has said it will maintain stringent limits in tap water for two substances, PFOA and PFOS, while giving water utilities an additional two years to meet those limits. But it is still considering to what extent it will regulate other PFAS included in the Biden-era rule. EPA says it will propose a new rule in the fall. Advertisement 'EPA is still evaluating the impact of its planned reconsideration and compliance extension proceedings on the issues presented in this case,' attorneys for EPA said in the new court filing. 'This evaluation has taken longer than anticipated at the time EPA filed its last motion to govern.'
Yahoo
29-05-2025
- Business
- Yahoo
Estimating The Intrinsic Value Of Essential Utilities, Inc. (NYSE:WTRG)
Essential Utilities' estimated fair value is US$42.57 based on Dividend Discount Model Current share price of US$38.12 suggests Essential Utilities is potentially trading close to its fair value Analyst price target for WTRG is US$45.56, which is 7.0% above our fair value estimate In this article we are going to estimate the intrinsic value of Essential Utilities, Inc. (NYSE:WTRG) by projecting its future cash flows and then discounting them to today's value. Our analysis will employ the Discounted Cash Flow (DCF) model. Models like these may appear beyond the comprehension of a lay person, but they're fairly easy to follow. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. For those who are keen learners of equity analysis, the Simply Wall St analysis model here may be something of interest to you. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. We have to calculate the value of Essential Utilities slightly differently to other stocks because it is a water utilities company. Instead of using free cash flows, which are hard to estimate and often not reported by analysts in this industry, dividends per share (DPS) payments are used. Unless a company pays out the majority of its FCF as a dividend, this method will typically underestimate the value of the stock. We use the Gordon Growth Model, which assumes dividend will grow into perpetuity at a rate that can be sustained. The dividend is expected to grow at an annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.9%. We then discount this figure to today's value at a cost of equity of 6.4%. Relative to the current share price of US$38.1, the company appears about fair value at a 10% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. Value Per Share = Expected Dividend Per Share / (Discount Rate - Perpetual Growth Rate) = US$1.5 / (6.4% – 2.9%) = US$42.6 We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Essential Utilities as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 6.4%, which is based on a levered beta of 0.800. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Check out our latest analysis for Essential Utilities Strength No major strengths identified for WTRG. Weakness Earnings growth over the past year underperformed the Water Utilities industry. Interest payments on debt are not well covered. Dividend is low compared to the top 25% of dividend payers in the Water Utilities market. Opportunity Annual earnings are forecast to grow for the next 3 years. Good value based on P/E ratio and estimated fair value. Threat Debt is not well covered by operating cash flow. Paying a dividend but company has no free cash flows. Annual earnings are forecast to grow slower than the American market. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn't be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. For Essential Utilities, we've compiled three pertinent elements you should explore: Risks: For instance, we've identified 2 warning signs for Essential Utilities (1 can't be ignored) you should be aware of. Future Earnings: How does WTRG's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
