Economic Outlook - The risk of a U.S. recession has increased, with estimates for a recession in 2025 or within the next year ranging from 40% to 60% according to various Wall Street firms and economists [3][4][21] - Goldman Sachs raised its one-year recession-risk probability to 45% from 35%, while JPMorgan set the odds at 60% [3][4] Stock Performance During Recessions - Defensive stocks, which typically pay dividends, are expected to perform better during economic downturns [5] - Categories of stocks that tend to hold up well include consumer staples, utilities, healthcare, and discount retailers [7][8] Historical Context - The Great Recession lasted from December 2007 to May 2009, with the S&P 500 index dropping 35.6% during this period [10] - Stocks that performed well during the Great Recession include Netflix, iShares Gold Trust ETF, J&J Snack Foods, Walmart, and McDonald's, with Netflix showing a return of 70.7% [12][15] Specific Stock Insights - Gold mining stocks and ETFs, such as Newmont and iShares Gold Trust, are seen as potential safe havens during recessions [17] - "Small indulgence stocks," like Netflix and Hershey, may see continued consumer spending even in downturns [18] - Utility stocks, such as American Water Works and NextEra Energy, have shown strong long-term performance, challenging the notion that they are merely "widow and orphan stocks" [19] Investment Strategy - Investors are advised to review their stock portfolios to enhance recession resistance while remaining invested in the market [21][22] - Long-term investors should avoid drastic changes to their portfolios, as timing the market can be challenging [23]

American Water Works (AWK) is scheduled to release first-quarter 2025 results on April 30, after market close. The company delivered an earnings surprise of 7.96% in the last reported quarter. (See the Zacks Earnings Calendar to stay ahead of market-making news.)Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.Major Factors That Might Have Impacted AWK's Q1 PerformanceAmerican Water Works’ first-quarter earnings are expected to have benefited from infrastructure im ...

Core Viewpoint - The U.S. stock markets are experiencing extreme volatility due to the imposition of new tariffs by the Trump administration, which has raised concerns about a potential global trade war and its impact on the U.S. economy [2][4]. Group 1: Market Overview - The baseline tariff of 10% was imposed on all imports starting April 5, 2025, with rates reaching as high as 145% for certain countries like China [2][3]. - The S&P 500 index is currently in correction territory, having declined by 8.6% year to date, and was trading close to bear market levels last week [5]. Group 2: Featured Stocks - A selection of stocks that have provided double-digit returns year to date includes American Water Works Co. Inc. (AWK), Exelon Corp. (EXC), CenterPoint Energy Inc. (CNP), The Progressive Corp. (PGR), and Brown & Brown Inc. (BRO), all carrying a Zacks Rank 2 (Buy) [6]. Group 3: American Water Works Co. Inc. (AWK) - AWK is benefiting from contributions from acquired assets and military contracts, with new water and wastewater rates enhancing performance [7]. - The company is expanding its operations through both organic and inorganic initiatives, with 17 pending acquisitions expected to add 24,200 customers [9]. - AWK has projected revenue and earnings growth rates of 1.6% and 6.1%, respectively, for the current year, with a recent 0.2% improvement in the earnings consensus estimate [10]. Group 4: Exelon Corp. (EXC) - Exelon's investments are aimed at strengthening its transmission and distribution infrastructure, with initiatives in grid modernization expected to enhance service reliability [11]. - The company anticipates revenue and earnings growth rates of 4.2% and 6.4%, respectively, for the current year, with a 0.8% improvement in the earnings consensus estimate over the last 30 days [12]. Group 5: CenterPoint Energy Inc. (CNP) - CNP is positioned to benefit from increasing electricity demand driven by the electrification of transportation and investments in renewable energy [13]. - The company has an expected revenue and earnings growth rate of 3.2% and 8%, respectively, for the current year, with a 0.6% improvement in the earnings consensus estimate over the last 60 days [16]. Group 6: The Progressive Corp. (PGR) - PGR is experiencing growth due to higher premiums and a strong product portfolio, focusing on becoming a one-stop insurance destination [17]. - The expected revenue and earnings growth rates for PGR are 16.1% and 10.9%, respectively, with a 1% improvement in the earnings consensus estimate over the last seven days [18]. Group 7: Brown & Brown Inc. (BRO) - BRO's growth trajectory is supported by a compelling portfolio and strategic initiatives that enhance its capabilities and geographic reach [19]. - The company has projected revenue and earnings growth rates of 8.4% and 9.1%, respectively, for the current year, with a 0.2% improvement in the earnings consensus estimate over the last 30 days [20].

Market Overview - U.S. stock markets are experiencing extreme volatility in April due to the "Liberation Day" tariffs imposed by the Trump administration, with a baseline tariff of 10% on all imports and rates as high as 145% for certain countries like China [1][2] - The S&P 500 index is currently in correction territory, trading almost in bear market zone, with a year-to-date decline of 8.6% [3] Investment Opportunities - Despite the overall market downturn, a handful of S&P 500 stocks have provided double-digit returns year to date, with five recommended stocks carrying a favorable Zacks Rank of 2 (Buy): American Water Works Co. Inc. (AWK), Exelon Corp. (EXC), CenterPoint Energy Inc. (CNP), The Progressive Corp. (PGR), and Brown & Brown Inc. (BRO) [4] American Water Works Co. Inc. (AWK) - AWK is benefiting from contributions from acquired assets and military contracts, with new water and wastewater rates boosting performance [8] - The company is expanding operations through organic and inorganic initiatives, with 17 pending acquisitions expected to add 24,200 customers [10] - AWK has expected revenue and earnings growth rates of 1.6% and 6.1%, respectively, for the current year, with a 0.2% improvement in the Zacks Consensus Estimate for current-year earnings over the last seven days [11] Exelon Corp. (EXC) - Exelon's investments are aimed at strengthening its transmission and distribution infrastructure, with initiatives in grid modernization improving operational resilience [12] - The company has expected revenue and earnings growth rates of 4.2% and 6.4%, respectively, for the current year, with a 0.8% improvement in the Zacks Consensus Estimate for current-year earnings over the last 30 days [13] CenterPoint Energy Inc. (CNP) - CNP is positioned to benefit from increasing electricity demand due to the electrification of transportation and investments in renewable energy [14] - The company has expected revenue and earnings growth rates of 3.2% and 8%, respectively, for the current year, with a 0.6% improvement in the Zacks Consensus Estimate for current-year earnings over the last 60 days [17] The Progressive Corp. (PGR) - PGR is gaining from higher premiums and a strong product portfolio, focusing on becoming a one-stop insurance destination [18] - The company has expected revenue and earnings growth rates of 16.1% and 10.9%, respectively, for the current year, with a 1% improvement in the Zacks Consensus Estimate for current-year earnings over the last seven days [19] Brown & Brown Inc. (BRO) - BRO's growth trajectory is driven by organic and inorganic initiatives, enhancing its capabilities and geographic reach [20] - The company has expected revenue and earnings growth rates of 8.4% and 9.1%, respectively, for the current year, with a 0.2% improvement in the Zacks Consensus Estimate for current-year earnings over the last 30 days [22]

American Water Works' (AWK) subsidiary, New Jersey American Water, has completed its acquisition of the water system of Shrewsbury Township's Alfred Vail Mutual Association community. This purchase, which serves 265 customer connections, followed the approval of the New Jersey Department of Community Affairs and the New Jersey Board of Public Utilities. This is the second acquisition in the State of New Jersey to be completed through the Water Infrastructure Protection Act ("WIPA"). As part of the deal, New ...

Core Insights - The market has experienced volatility due to tariff discussions, impacting leading stocks negatively [1] - Targeting low-beta stocks can help investors balance their risk profiles during such volatility [1][6] - The Progressive Corp. (PGR) and American Water Works (AWK) are highlighted as potential 'defensive' additions [1][6] Company Performance - PGR shares have increased over 20% in 2025, significantly outperforming the S&P 500 [3] - PGR has consistently exceeded Zacks Consensus EPS estimates by an average of 18.5% over the last four quarters [3] - PGR currently has a Zacks Rank of 2 (Buy) with rising earnings expectations [3] - PGR offers a modest annual yield of 0.2%, appealing to investors despite not being a primary target for income-focused strategies [4] AWK Performance - AWK shares have gained 14% in 2025, contrasting with a 14% decline in the S&P 500 [5] - AWK exceeded both consensus EPS and sales expectations in its latest quarterly results [5] - The company reaffirmed its previous guidance, contributing to positive investor sentiment [5] - AWK provides a stronger income option with a current annual yield of 2.2% and an 8.8% five-year annualized dividend growth rate [5][7]

Buying and holding a stock over the long term requires conviction that the company will live up to investor expectations.For growth stocks, that can mean unlocking the potential of a paradigm-shifting technology. In contrast, investors may expect dividend-paying companies to steadily boost their earnings and payouts over time, rewarding them with a one-two punch of passive income and capital gains.Here's why Lockheed Martin (LMT -4.81%), American Water Works (AWK -3.06%), and Watsco (WSO -2.98%) stand out a ...

Group 1 - American Water Works Company, Inc. shares are currently trading higher, but there is a potential for a reversal and decline in stock price [1] - Historical data shows that the stock has previously faced resistance around the $148.00 level, leading to sell-offs after reaching this price [1][6] - Investor psychology plays a significant role in creating resistance, as many investors who bought shares at this level may place sell orders to avoid losses, contributing to the resistance [3][5][6] Group 2 - The concentration of sell orders at the $148.00 level is likely to lead to another sell-off, as seen in past occurrences when the stock reached this price [6][8] - The behavior of traders and investors, driven by fear of selling at a lower price, can create a snowball effect that further drives the stock price down [7]

Economic Overview - The University of Michigan's Consumer Sentiment Index for mid-March dropped to 57.9, significantly below the consensus estimate of 63.2 and the final reading of 64.7 in February, indicating a decline in consumer confidence [4] - The short-term inflation outlook increased to 4.9% in March from 4.3% in February, the highest since November 2022, while the long-term inflation outlook rose to 3.9% from 3.4%, marking the highest since February 1991 [5] Investment Strategy - Investment in low-beta high-yielding stocks is recommended as a strategy to safeguard portfolios during uncertain market conditions, with the potential for upside if markets recover [6][8] - The utility sector is highlighted for its stability and consistent demand, making it a favorable choice for income-oriented investors [7][8] Company Highlights Ameren Corp. (AEE) - Ameren plans to invest up to $26.3 billion from 2025 to 2029 to enhance customer reliability and transition to cleaner energy sources [11][12] - Expected revenue and earnings growth rates for the current year are 6% and 6.7%, respectively, with a current dividend yield of 2.90% [14] Atmos Energy Corp. (ATO) - Atmos Energy benefits from rising demand for natural gas and has a long-term investment plan to improve pipeline reliability [15] - Expected revenue and earnings growth rates for the current year are 18.2% and 5.1%, respectively, with a current dividend yield of 2.37% [17] American Water Works Co. Inc. (AWK) - American Water Works is expanding through acquisitions and new water rates, with pending acquisitions expected to add 24,200 customers [21] - Expected revenue and earnings growth rates for the current year are 1.1% and 5.9%, respectively, with a current dividend yield of 2.15% [22] Entergy Corp. (ETR) - Entergy plans to invest $37 billion from 2025 to 2028 to modernize its infrastructure and expand renewable capacity [23] - Expected revenue and earnings growth rates for the current year are 5.5% and 6.3%, respectively, with a current dividend yield of 2.90% [25] NiSource Inc. (NI) - NiSource expects to invest $19.4 billion from 2025 to 2029 to modernize infrastructure and aims to retire all coal-generating sources by 2028 [26][27] - Expected revenue and earnings growth rates for the current year are 11.1% and 9.1%, respectively, with a current dividend yield of 2.90% [28]

Company Performance - American Water Works (AWK) has outperformed the Utilities sector with a year-to-date return of approximately 14.5%, compared to the sector average of 2.4% [4] - The Zacks Consensus Estimate for AWK's full-year earnings has increased by 0.3% over the past quarter, indicating improved analyst sentiment and a stronger earnings outlook [3] - AWK belongs to the Utility - Water Supply industry, which has seen an average gain of about 11.9% this year, further highlighting AWK's strong performance within its specific industry [5] Industry Comparison - The Utilities sector, which includes 104 individual stocks, currently holds a Zacks Sector Rank of 7 out of 16 sector groups [2] - Another stock in the Utilities sector, Southwest Gas (SWX), has returned 3.9% year-to-date and also holds a Zacks Rank of 2 (Buy) [4][5] - The Utility - Gas Distribution industry, which includes Southwest Gas, has experienced a decline of -9.4% since the beginning of the year, contrasting with the performance of the Utility - Water Supply industry [6]