BofA reinstated coverage of American Water with an Underperform rating and $140 price target. American Water “materially outperformed” regulated electric and gas utilities as low interest rates aided performance, and although that outperformance sharply reversed in 2022 as rates moved higher, BofA still thinks the 45% relative P/E premium versus electric and gas utilities is “higher than what is justifiable,” the analyst tells investors.
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