Why Is American Water Works (AWK) Up 4.4% Since Last Earnings Report?

It has been about a month since the last earnings report for American Water Works (AWK). Shares have added about 4.4% in that time frame, outperforming 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? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.American Water Works Q4 Earnings Miss Estimates, Revenues BeatAmerican Water Works Company reported fourth-quarter 2025 adjusted earnings per share (EPS) of $1.24, which lagged the Zacks Consensus Estimate of $1.28 by 3.1%.The bottom line improved 7.8% from the year-ago quarter's level of $1.15, driven by higher year-over-year revenues and operating income growth.The company reported adjusted 2025 EPS of $5.64 compared with $5.18 in 2024.Total Revenues of AWKAWK’s total quarterly revenues of $1.27 billion surpassed the Zacks Consensus Estimate of $1.22 billion by 3.9%. The top line also increased 5.8% from the year-ago figure of $1.2 billion.2025 revenues were $5.14 billion compared with $4.68 billion in 2024. The year-over-year rise was primarily due to authorized revenue increases resulting from completed general rate cases and infrastructure proceedings to recover incremental capital and acquisition investments.AWK’s Segmental DetailsRegulated businesses’ net revenues in 2025 were $4.7 billion, up 10.3% year over year.Others’ net revenues in 2025 were $417 million, up 7.5% year over year.Highlights of AWK’s Q4 ReleaseTotal operating expenses for the fourth quarter were $866 million, up 8.1% from the year-ago quarter’s $801 million, due to an increase in employee-related costs and production costs, which include higher purchased power and purchased water costs and usage, as well as general taxes associated with increased capital investment.The operating income totaled $405 million, up 1.3% from the year-ago figure of $400 million.Financial Details of AWKCash and cash equivalents amounted to $98 million as of Dec. 31, 2025, compared with $96 million as of Dec. 31, 2024.Total long-term debt was $12.78 billion as of Dec. 31, 2025, up 2.1% from $12.52 billion as of Dec. 31, 2024.In 2025, cash flow from operating activities was $2.06 billion compared with $2.05 billion in the year-ago period.Merger UpdateOn Feb. 10, 2026, shareholders of American Water Works and Essential Utilities overwhelmingly approved their merger-related proposals.AWK’s Long-Term GuidanceAmerican Water Works affirmed its 2026 EPS guidance in the range of $6.02-$6.12. The Zacks Consensus Estimate of $6.11 lies at the high end of the company’s guided range.AWK plans to invest $3.7 billion in 2026. Over the long run, most of its outlook remains unchanged. The company still expects its long-term EPS and dividend growth to be 7-9% and rate base growth to be 8-9%. In terms of its long-term capital expenditure plan, American Water Works expects to invest $19-$20 billion during 2026-2030 and $46-$48 billion during 2026-2035.How Have Estimates Been Moving Since Then?Since the earnings release, investors have witnessed a downward trend in estimates review.VGM ScoresCurrently, 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 has a grade 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.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, American Water Works has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.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