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Friday, September 22, 2023

The Forecast Just Changed on Essential Utilities Inc. (NYSE:WTRG)

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Essential Utilities Inc. (WTRG) shares are trading at higher $42.57 and the avg recommendation for the stock is Moderate Buy, while the current analyst price target stands at $49.00.

To add more color to this target, the company’s high over the last year is $54.52 and the low is $30.40. Over the last 52 weeks, WTRG is down -8.49% while the S&P 500 is up 14.62%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, WTRG reported a profit of $123.12 million. Essential Utilities Inc. also saw revenues increase to $384.47 million. In addition, WTRG has free cash flow of -$3.51 billion as of 06-2020. The company’s EBITDA came in at $193.01 million which compares well with its peers.

WTRG booked profit margins of 25.20%, its Return on Equity (ROE) is 6.60%, and its Return on Assets is 2.50%. All told, it is clear that, WTRG needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. WTRG has a short ratio of 11.05 and outstanding shares of 254.17M.

Company Outlook

WTRG has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 0.85 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 1.13. Essential Utilities Inc. WTRG also noted assets of $12.96 billion at the end of the last quarter. Investors should also keep an eye on sector updates as WTRG has historically followed its peers on positive news.

All told, Essential Utilities Inc. WTRG has strung together solid data and demonstrated underlying fundamentals. At its current valuation, WTRG represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Essential Utilities Inc. WTRG is now commanding a market cap of 10.34B and a float of 244.76M. WTRG is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of WTRG stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in WTRG, either long or short, and we have not been compensated for this article.

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