[Q2 2025 Earnings Release](index=1&type=section&id=Q2%202025%20Earnings%20Release) [Performance Highlights and Outlook](index=1&type=section&id=Performance%20Highlights%20and%20Outlook) American Water reported strong Q2 2025 diluted EPS of $1.48, narrowed 2025 EPS guidance to $5.70-$5.75, affirmed long-term growth targets, and progressed on capital investments and acquisitions Q2 & YTD 2025 Earnings Per Share (EPS) | Period | 2025 Diluted EPS | 2024 Diluted EPS | Change | | :--- | :--- | :--- | :--- | | **Second Quarter** | $1.48 | $1.42 | +$0.06 | | **Year-to-Date** | $2.53 | $2.37 | +$0.16 | 2025 EPS Guidance (Weather-Normalized) | Guidance | Range | | :--- | :--- | | **Previous** | $5.65 - $5.75 | | **Narrowed** | $5.70 - $5.75 | - The company affirmed its long-term financial targets, including an EPS and dividend growth rate of **7-9%**[5](index=5&type=chunk) - Announced an agreement to purchase Nexus Water Group systems, adding to its acquisition growth strategy. As of July 30, 2025, the company has approximately **87,000 customer connections** under agreement in total[4](index=4&type=chunk)[6](index=6&type=chunk) - The 2025 capital investment plan of **$3.3 billion** is on track, with **$1.3 billion** invested through June 30, 2025[6](index=6&type=chunk)[8](index=8&type=chunk) [Financial and Operational Review](index=3&type=section&id=Financial%20and%20Operational%20Review) The company's financial and operational performance for Q2 and H1 2025 is reviewed, highlighting revenue growth drivers, increased expenses, and the latest dividend declaration [Consolidated Results](index=3&type=section&id=Consolidated%20Results) Consolidated EPS for Q2 2025 increased to $1.48, driven by new rates in Regulated Businesses, partially offset by higher operating and financing costs, with a $0.06 unfavorable weather impact - Growth was primarily driven by increased revenues from new rates in the Regulated Businesses, offset by higher operating, depreciation, and financing costs[7](index=7&type=chunk) - Weather had an estimated net unfavorable impact of **$0.06 per share** for the six months ended June 30, 2025, compared to the same period in 2024[7](index=7&type=chunk) - The company invested **$1.3 billion** in the first six months of 2025, on track to meet its full-year capital plan of approximately **$3.3 billion**[8](index=8&type=chunk) [Regulated Businesses Performance](index=3&type=section&id=Regulated%20Businesses%20Performance) The Regulated Businesses segment reported increased net income for Q2 and H1 2025, driven by authorized rate increases, partially offset by higher operating, depreciation, and interest expenses Regulated Businesses Net Income (in millions) | Period | 2025 Net Income | 2024 Net Income | | :--- | :--- | :--- | | **Second Quarter** | $288 | $274 | | **First Six Months** | $489 | $459 | - Operating revenues increased by **$121 million** for Q2 and **$242 million** for the first six months of 2025, mainly due to authorized revenue increases from rate cases and infrastructure proceedings[10](index=10&type=chunk) - Since January 1, 2025, the company has been authorized additional annualized revenues of **$270 million** and has pending requests for an additional **$126 million**[11](index=11&type=chunk) - Operating expenses rose by **$83 million** for Q2 and **$161 million** for the first six months, driven by employee costs, technology, taxes, and depreciation. Interest expense also increased due to debt used to fund capital investments[12](index=12&type=chunk)[13](index=13&type=chunk) [Dividends](index=3&type=section&id=Dividends) The Board of Directors declared a quarterly cash dividend of $0.8275 per share, payable on September 3, 2025, to shareholders of record as of August 12, 2025 Quarterly Dividend Declaration | Metric | Value | | :--- | :--- | | **Dividend per Share** | $0.8275 | | **Record Date** | August 12, 2025 | | **Payment Date** | September 3, 2025 | [Financial Statements](index=7&type=section&id=Financial%20Statements) This section presents the unaudited consolidated Statements of Operations and Balance Sheets as of June 30, 2025, detailing the company's financial performance and position [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2025, operating revenues increased to $2,418 million, leading to higher operating income and net income attributable to common shareholders Consolidated Statements of Operations Highlights (Six Months Ended June 30, in millions) | Account | 2025 | 2024 | | :--- | :--- | :--- | | **Operating revenues** | $2,418 | $2,160 | | **Operating income** | $860 | $775 | | **Net income attributable to common shareholders** | $494 | $462 | [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to $33,913 million, driven by property, plant, and equipment growth, with total common shareholders' equity rising to $10,682 million Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total assets** | $33,913 | $32,830 | | Property, plant and equipment, net | $28,932 | $28,038 | | **Total liabilities** | $21,631 | $20,977 | | Long-term debt | $12,281 | $12,521 | | **Total common shareholders' equity** | $10,682 | $10,332 | [Corporate Information and Forward-Looking Statements](index=3&type=section&id=Corporate%20Information%20and%20Forward-Looking%20Statements) This section provides general corporate information, details for the earnings conference call, and a cautionary statement regarding forward-looking statements and associated risks [About American Water](index=4&type=section&id=About%20American%20Water) American Water is the largest regulated water and wastewater utility in the United States, serving over 14 million people across 14 states and 18 military installations - American Water is the largest regulated water and wastewater utility in the U.S., serving over **14 million people**[17](index=17&type=chunk) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) The Q2 2025 earnings conference call is scheduled for July 31, 2025, at 9 a.m. ET, with an audio webcast and presentation slides available on the investor relations website - The Q2 2025 earnings conference call is scheduled for July 31, 2025, at **9 a.m. ET**, with a webcast available at ir.amwater.com[15](index=15&type=chunk) [Cautionary Statement Concerning Forward-Looking Statements](index=4&type=section&id=Cautionary%20Statement%20Concerning%20Forward-Looking%20Statements) This section cautions that forward-looking statements, including earnings guidance and growth targets, are subject to significant risks and uncertainties, advising readers to consult SEC filings for comprehensive risk factors - Forward-looking statements regarding guidance, growth targets, and capital expenditures are not guarantees of future performance and are subject to significant risks and uncertainties[19](index=19&type=chunk) - Key risks include regulatory decisions, changes in customer demand, weather events, infrastructure challenges, cybersecurity threats, and changes in economic conditions[19](index=19&type=chunk)[20](index=20&type=chunk)

[Part I. Financial Information](index=7&type=section&id=Part%20I.%20Financial%20Information) This section covers the company's consolidated financial statements, management's discussion, market risk, and internal controls [Item 1. Consolidated Financial Statements](index=7&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for American Water Works Company, Inc. as of June 30, 2025, and for the three and six-month periods then ended [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $33.91 billion, an increase from $32.83 billion at year-end 2024, primarily driven by a rise in net property, plant, and equipment Consolidated Balance Sheet Highlights (in millions) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$33,913** | **$32,830** | | Property, plant and equipment, net | $28,932 | $28,038 | | Total current assets | $1,399 | $1,215 | | **Total Liabilities** | **$23,231** | **$22,498** | | Long-term debt (including current portion) | $13,397 | $13,155 | | Short-term debt | $1,589 | $879 | | **Total Common Shareholders' Equity** | **$10,682** | **$10,332** | [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2025, operating revenues increased to $2.42 billion from $2.16 billion year-over-year, with net income attributable to common shareholders rising to $494 million Statement of Operations Summary (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenues | $1,276 | $1,149 | $2,418 | $2,160 | | Operating Income | $489 | $449 | $860 | $775 | | Net Income Attributable to Common Shareholders | $289 | $277 | $494 | $462 | | Diluted Earnings Per Share | $1.48 | $1.42 | $2.53 | $2.37 | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash from operating activities was $632 million, while net cash used in investing activities was $1.34 billion, resulting in a net decrease in cash of $5 million Cash Flow Summary for the Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $632 | $727 | | Net cash used in investing activities | $(1,340) | $(1,471) | | Net cash provided by financing activities | $703 | $478 | | **Net decrease in cash, cash equivalents and restricted funds** | **$(5)** | **$(266)** | [Notes to Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the company's accounting policies, regulatory activities, acquisitions, debt structure, contingencies, and segment performance, including $232 million in annualized revenue from 2025 general rate cases [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=42&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results for the second quarter and first half of 2025, highlighting that diluted EPS for the six months ended June 30, 2025, increased to $2.53 from $2.37 year-over-year, driven by new rates from capital investments - Diluted EPS for the six months ended June 30, 2025, was **$2.53**, up from **$2.37** in 2024, primarily driven by new rates in the Regulated Businesses, partially offset by an estimated unfavorable weather impact of **$0.06 per share**[178](index=178&type=chunk) - The company plans to invest approximately **$3.3 billion** in growth strategies in 2025, having invested **$1.3 billion** in Regulated Businesses for infrastructure and **$21 million** for acquisitions adding approximately **7,600 customers** in the first six months[179](index=179&type=chunk)[181](index=181&type=chunk) - On May 19, 2025, the Company entered into an agreement to acquire Nexus Regulated Utilities for approximately **$315 million** in cash, expected to add nearly **47,000 customer connections** and an estimated **$200 million in rate base**, with closing anticipated by or before August 2026[180](index=180&type=chunk)[182](index=182&type=chunk) - The company received an initial settlement payment of **$34 million (net)** from 3M Company related to the PFAS multi-district litigation, recorded as a regulatory liability for customer benefit pending PUC approval[139](index=139&type=chunk)[187](index=187&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) Consolidated operating revenues for the six months ended June 30, 2025, increased by $258 million to $2.42 billion, primarily from authorized rate increases in the Regulated Businesses segment, partly offset by increased operating and depreciation expenses Regulated Businesses Revenue Change Drivers (Six Months Ended June 30, 2025 vs 2024) | Driver | Change (in millions) | | :--- | :--- | | Authorized Rate Increases (incl. surcharges) | +$213 | | Acquisitions and Organic Growth | +$25 | | Unfavorable Weather Impact | -$17 | | **Total Revenue Increase** | **~$242** | - Regulated Businesses' O&M expenses for the first six months of 2025 increased by **$94 million** year-over-year, driven by higher employee-related costs, technology-related services, production costs, and customer uncollectible expense[212](index=212&type=chunk) - Depreciation and amortization for the Regulated Businesses increased by **$57 million** for the six months ended June 30, 2025, due to additional utility plant placed in service and higher depreciation rates from recent rate cases[213](index=213&type=chunk) [Regulatory Matters](index=44&type=section&id=Regulatory%20Matters) In 2025, the company received authorizations for $232 million in annualized incremental revenues from general rate cases and $38 million from infrastructure surcharge mechanisms, with several general rate cases pending 2025 General Rate Case Authorizations (in millions) | State | Annualized Revenue | Effective Date | | :--- | :--- | :--- | | Illinois | $105 | Jan 1, 2025 | | Missouri | $63 | May 28, 2025 | | Indiana (Step) | $17 | May 14, 2025 | | California (Step) | $17 | Jan 1, 2025 | | Virginia | $15 | Feb 24, 2025 | | Iowa | $13 | Aug 1, 2025 | | Other | $2 | Various | | **Total** | **$232** | | - The company received authorizations for **$38 million** in annualized incremental revenues from infrastructure surcharges effective in 2025, with the largest amounts from New Jersey (**$15 million**) and Missouri (**$17 million**)[204](index=204&type=chunk) - Pending general rate cases include a request in California for a **$111 million** total increase over 2027-2029, a **$27 million** request in Kentucky, and a **$48 million** request in West Virginia[201](index=201&type=chunk)[202](index=202&type=chunk)[203](index=203&type=chunk) [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company had total available liquidity of $1.17 billion, down from $1.88 billion at year-end 2024, primarily due to increased commercial paper borrowings, while maintaining compliance with debt covenants Available Liquidity (in millions) | Component | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and Cash Equivalents | $94 | $96 | | Availability on Revolving Credit Facility | $1,075 | $1,788 | | **Total Available Liquidity** | **$1,169** | **$1,884** | - Cash flows from operating activities decreased by **$95 million** for the first six months of 2025 compared to 2024, primarily due to a CAMT liability payment and higher customer receivables[243](index=243&type=chunk) - The company's debt-to-capitalization ratio was **0.58 to 1.00** as of June 30, 2025, well within the covenant requirement of not more than **0.70 to 1.00**[248](index=248&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that it is exposed to market risks, including changes in commodity prices, equity prices, and interest rates, with no significant changes since December 31, 2024 - There have been no significant changes to the Company's exposure to market risk since December 31, 2024[255](index=255&type=chunk) [Item 4. Controls and Procedures](index=56&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting identified - The CEO and CFO concluded that as of June 30, 2025, the Company's disclosure controls and procedures were effective at a reasonable level of assurance[257](index=257&type=chunk) - No changes in internal control over financial reporting occurred during the three months ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting[258](index=258&type=chunk) [Part II. Other Information](index=57&type=section&id=Part%20II.%20Other%20Information) This section provides updates on legal proceedings, risk factors, equity security sales, defaults, mine safety, other information, and a list of exhibits [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) This section provides updates on key legal matters, including a denied petition challenging the coastal development permit for the Water Supply Project, preliminary court approval for a class action settlement, and a $34 million initial settlement payment related to PFAS litigation - Regarding the Monterey Peninsula Water Supply Project, a court denied a petition challenging the coastal development permit, and the CPUC authorized an **$11 million** increase to the cost cap for certain extraction wells[261](index=261&type=chunk)[263](index=263&type=chunk) - A proposed class action settlement agreement in the Dunbar, West Virginia litigation received preliminary court approval on May 5, 2025, with a final approval hearing scheduled for September 11, 2025[266](index=266&type=chunk) - As of June 30, 2025, the Company received an initial settlement payment of **$34 million (net)** from 3M Company in the PFAS multi-district litigation, with additional payments anticipated in 2025[267](index=267&type=chunk) [Item 1A. Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) The company reports that there have been no material changes from the risk factors that were previously disclosed in its Annual Report on Form 10-K - There have been no material changes from the risk factors previously disclosed in the Company's Form 10-K[268](index=268&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On May 28, 2025, the company issued 48,381 shares of common stock from treasury stock as consideration for the acquisition of Audubon Water Company, and did not repurchase any shares during the quarter - The Company issued **48,381 shares** of its common stock on May 28, 2025, as consideration for the acquisition of Audubon Water Company[269](index=269&type=chunk) - No common stock was repurchased during the three months ended June 30, 2025, with an aggregate of **5,140,000 shares** remaining available for repurchase under the anti-dilutive stock repurchase program[271](index=271&type=chunk) [Item 3. Defaults Upon Senior Securities](index=58&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities during the period - None[272](index=272&type=chunk) [Item 4. Mine Safety Disclosures](index=58&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[273](index=273&type=chunk) [Item 5. Other Information](index=58&type=section&id=Item%205.%20Other%20Information) During the second quarter of 2025, none of the company's directors or officers adopted or terminated a Rule 10b5-1 trading plan or any non-Rule 10b5-1 trading arrangement - During the three months ended June 30, 2025, no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements[274](index=274&type=chunk) [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including agreements related to acquisitions, debt instruments, compensation plans, and certifications by the CEO and CFO

Core Viewpoint - American Water Works (AWK) is expected to report a year-over-year increase in earnings and revenues for the quarter ended June 2025, with a consensus outlook indicating potential stock price movements based on actual results compared to estimates [1][2]. Earnings Expectations - The consensus estimate for quarterly earnings is $1.49 per share, reflecting a year-over-year increase of +4.9% [3]. - Expected revenues are projected at $1.15 billion, which is an increase of 0.5% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised 0.13% lower in the last 30 days, indicating a reassessment by analysts [4]. - The direction of estimate revisions may not always align with the aggregate change, suggesting variability in analyst sentiment [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for American Water Works is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +0.67% [11]. - The company holds a Zacks Rank of 2, suggesting a strong likelihood of beating the consensus EPS estimate [11]. Historical Performance - In the last reported quarter, American Water Works had an earnings surprise of +0.96%, reporting $1.05 per share against an expectation of $1.04 [12]. - Over the past four quarters, the company has beaten consensus EPS estimates two times [13]. Conclusion - American Water Works is positioned as a compelling candidate for an earnings beat, but investors should consider additional factors influencing stock performance beyond earnings results [16].

Core Insights - American Water Works (AWK) has consistently surpassed earnings estimates, making it a strong candidate for future investment opportunities [1][5] - The company reported earnings of $1.05 per share for the last quarter, exceeding the Zacks Consensus Estimate of $1.04 per share by 0.96% [2] - In the previous quarter, AWK's earnings were $1.22 per share against an expectation of $1.13, resulting in a surprise of 7.96% [2] Earnings Performance - Over the last two quarters, American Water Works has averaged a 4.46% earnings surprise [1] - The company's positive Earnings ESP (Expected Surprise Prediction) stands at +1.84%, indicating bullish sentiment among analysts regarding its near-term earnings potential [8] - The next earnings report for American Water Works is anticipated on July 30, 2025 [8] Zacks Rank and Predictive Metrics - American Water Works holds a Zacks Rank of 2 (Buy), which, when combined with its positive Earnings ESP, suggests a high likelihood of another earnings beat [8] - Research indicates that stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have a nearly 70% chance of producing a positive surprise [6] - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, reflecting the latest analyst revisions [7]

Core Viewpoint - The article highlights S&P 500 dividend stocks that have experienced significant price declines, presenting them as attractive buying opportunities for long-term investors due to their strong fundamentals and consistent dividend growth. Group 1: Overview of Dividend Stocks - Dividend stocks are powerful wealth compounders, with the S&P 500 index showing over 300% growth in the past 25 years, and total returns exceeding 550% when including reinvested dividends [1] - The article identifies 10 S&P 500 dividend stocks that are currently trading at least 10% below their all-time highs, suggesting they are good buys for long-term holding [2] Group 2: Individual Stock Analysis - **Johnson & Johnson**: Down 11.5%, yield 3.4%, generated $95 billion in free cash flow over five years, returning 60% to shareholders, and has increased dividends for 62 consecutive years [4] - **ExxonMobil**: Down 11.6%, yield 3.7%, generated $55 billion in cash flow from operations in 2024, with a 42-year streak of dividend increases, and focusing on boosting cash flows post-acquisition of Pioneer Natural Resources [5] - **Procter & Gamble**: Down 14%, yield 2.7%, restructuring operations to target mid- to high-single-digit core earnings per share growth, and has increased dividends for 69 consecutive years [6][7] - **NextEra Energy**: Down 19%, yield 3.3%, operates the largest electric utility in America and is the largest producer of wind and solar energy, with over 20 years of dividend increases [8] - **Chevron**: Down 19%, yield 4.8%, has increased dividends for 38 consecutive years, and recently acquired Hess in a $53 billion deal [10] - **American Water Works**: Down 24%, yield 2.4%, serves over 14 million customers, targeting 7% to 9% annual dividend growth [11][13] - **Realty Income**: Down 29%, yield 5.6%, pays monthly dividends and has increased them for 110 consecutive quarters, owning over 15,000 properties [14] - **Oneok**: Down 29%, yield 5%, has a network of pipelines spanning 60,000 miles, targeting 3% to 4% annual dividend growth [15] - **Nucor**: Down 30%, yield 1.7%, America's largest steel company, has increased dividends for 52 straight years, and aims to return at least 40% of earnings to shareholders [16] - **Medtronic**: Down 33%, yield 3.3%, world's largest medical device manufacturer with $33.5 billion in revenue, plans to divest its diabetes business, and is close to becoming a Dividend King [18]

Core Insights - American Water Works Company's subsidiary, Pennsylvania American Water, is acquiring the Indian Creek Valley Water Authority and the Sutersville-Sewickley Municipal Sewage Authority, expanding its customer base by approximately 2,700 metered water connections and 500 wastewater consumers for a total purchase price of $36.05 million [1][9]. Group 1: Acquisitions and Investments - The acquisition of the Indian Creek Valley system is priced at $32.8 million, while the Sutersville-Sewickley wastewater system will be acquired for $3.25 million [1][9]. - Pennsylvania American Water plans to invest $8.9 million in upgrades to the Indian Creek Valley Water Authority's infrastructure and allocate $800,000 for enhancements to the Sutersville-Sewickley wastewater system [2][9]. Group 2: Industry Context - The U.S. water industry is highly fragmented, with over 50,000 community water systems and 14,000 wastewater treatment systems, many of which are struggling with aging infrastructure and operational inefficiencies [4]. - The American Society of Civil Engineers reports that water main breaks occur every two minutes, highlighting the urgent need for infrastructure investment, estimated at $1.25 trillion over the next 20 years [5]. Group 3: Strategic Growth - American Water has been active in strategic acquisitions, completing three acquisitions in three states as of April 30, 2025, with 18 pending acquisitions expected to add another 37,400 customers [6]. - Other companies in the industry, such as Essential Utilities and California Water Service Group, are also pursuing acquisitions to expand their operations and improve service quality [7][8]. Group 4: Financial Performance - Over the past decade, American Water has invested more than $4.27 billion in capital improvements and plans to continue annual investments between $525 million and $625 million, with over $586 million planned for 2025 alone [3]. - In the past six months, shares of American Water have risen 15.2%, compared to the industry's growth of 18.7% [11].

Core Viewpoint - Dividend growth stocks are highlighted as valuable investment opportunities due to their potential for passive income and wealth accumulation through reinvestment and compounding [1][2]. Group 1: Dividend Stocks Overview - The focus is on prioritizing dividend stability and growth over high yield, identifying 10 dividend stocks that offer both growth and attractive yields [2]. - The article emphasizes the importance of investing in high-quality dividend growth stocks for long-term returns [1]. Group 2: Individual Stock Highlights - **Realty Income**: Offers a yield of 5.6%, has paid dividends since 1994, and increased its dividend 130 times, currently trading 30% below all-time highs [4][5]. - **NextEra Energy**: Yield of 3.2%, the largest electric utility in the U.S., has increased dividends for over 20 years, with a projected annual growth of 6% to 8% in earnings and 10% in dividends through at least 2026 [6][7]. - **Enterprise Products Partners**: Yield of 6.9%, has raised dividends for 26 consecutive years, with $6 billion in projects expected to boost cash flows [8][10]. - **Brookfield Infrastructure**: Yield of 4.2%, has increased dividends since 2009 at a CAGR of 14%, with expected long-term dividend growth of 5% to 9% [11][12]. - **American Water Works**: Yield of 2.4%, plans to invest $40 billion to $42 billion in infrastructure over the next decade, expecting EPS growth of 7% to 9% [13][15]. - **Waste Management**: Yield of 1.5%, has increased dividends for 22 consecutive years, with a recent acquisition expected to generate $250 million in annual cost synergies [16][18]. - **Brookfield Renewable**: Yield of 4.6%, targeting FFO growth of over 10% and annual dividend growth of 5% to 9% [19][20]. - **Caterpillar**: Yield of 1.6%, has a strong dividend history with a recent 7% hike, committed to returning a significant portion of FCF to shareholders [22][24]. - **Emerson Electric**: Yield of 1.6%, a Dividend King with a 69-year streak of dividend increases, reflecting operational efficiency and growth in automation [25][26]. - **Parker-Hannifin**: Yield of 1%, has increased dividends for 69 consecutive years, with significant growth opportunities in a $145 billion market [27][30].

Financial Performance - Operating revenues increased from $2.88 billion in 2013 to $3.01 billion in 2014[15] - Adjusted diluted earnings per share from continuing operations increased by 10%, from $2.21 in 2013 to $2.43 in 2014[40] - The company is reaffirming its 2015 EPS guidance of $2.55-$2.65[22] - The company's long-term EPS growth goal is 7-10% from 2015-2019, anchored from FY 2013[23, 24] - Adjusted Return on Equity increased from 832% to 886% from 2013 to 2014[51, 89] Investments and Acquisitions - The company invested $1 billion in infrastructure in 2014, $100 million over the original estimate[18] - The company closed acquisitions of 13 systems in 2014, adding 4,500 water & wastewater customers[18] - 11 announced pending acquisitions are expected to add 21,500 water & wastewater customers[18] Regulatory Updates - New Jersey Rate Case filing requests a $662 million increase, or 996%[29] - Indiana American rate case order effective January 29, 2015, includes $51 million revenues (26% increase) driven by over $220 million investment in assets[30] Operational Efficiency - The company is targeting an O&M Efficiency Ratio of 34% by 2020[32]

2015 Fourth Quarter Earnings Conference Call February 25, 2016 1 Greg Panagos Vice President of Investor Relations 2 Susan Story President and Chief Executive Officer Walter Lynch Chief Operating Officer Forward-Looking Statements Certain statements in this presentation including, without limitation, 2015 earnings guidance, the outcome of pending acquisition activity, the amount of future capital investments, and estimated revenues from rate cases and other government agency authorizations, are forward-look ...

Financial Performance - American Water's adjusted earnings per share (EPS) from continuing operations increased from $2.64 in 2015 to $2.84 in 2016[29] - The company affirms its 2017 guidance range for EPS to be $2.98 - $3.08[79] - The company anticipates a 7-10% EPS Compound Annual Growth Rate (CAGR) through 2021, anchored off 2015 EPS[34] - The company's common dividends declared showed a CAGR of 10% from 2014 to 2017[35] - American Water's capital investment reached a record level of $1.3 billion in 2016 for regulated infrastructure[24] - Cash flow from operations increased by 8.2% from 2015 to 2016[77] Regulated Business - The company's regulated business remains the foundation of its long-term growth strategy[23] - The Illinois Commerce Commission approved a $35.2 million rate increase for American Water, authorizing a 9.79% Return on Equity (ROE)[41] - The company closed acquisitions serving approximately 42,000 customers and had pending acquisitions for approximately 40,000 customers in 2016[24] - The company's O&M efficiency ratio improved to 34.9% in 2016 and is targeting 32.5% by 2021[24, 50]