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Consolidated Water Co Ltd (CWCO)
NASDAQ:CWCO
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Consolidated Water Co
(NASDAQ:CWCO)
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Rating:74Outperform
Price Target:
$36.00
â–²(7.59% Upside)
Consolidated Water Co's stock is supported by strong financial performance and technical indicators, reflecting robust revenue growth and a solid upward trend in stock price. However, valuation concerns due to a high P/E ratio and modest dividend yield, along with challenges highlighted in the earnings call, slightly temper the overall score. The company's strategic initiatives and financial stability provide a cautiously optimistic outlook.
Consolidated Water Co (CWCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$533.55M
Dividend Yield1.49%
Average Volume (3M)93.23K
Price to Earnings (P/E)34.0
Beta (1Y)0.70
Revenue Growth-26.34%
EPS Growth-61.52%
CountryUS
Employees307
SectorUtilities
Sector Strength65
IndustryRegulated Water
Share Statistics
EPS (TTM)0.32
Shares Outstanding15,926,801
10 Day Avg. Volume94,978
30 Day Avg. Volume93,229
Financial Highlights & Ratios
PEG Ratio-2.73
Price to Book (P/B)1.95
Price to Sales (P/S)3.06
P/FCF Ratio13.75
Enterprise Value/Market Cap0.71
Enterprise Value/Revenue2.93
Enterprise Value/Gross Profit8.36
Enterprise Value/Ebitda14.55
Forecast
1Y Price Target
$40.00Price Target Upside19.55% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Consolidated Water Co Business Overview & Revenue Model
Company DescriptionConsolidated Water Co. (CWCO) is a leading water utility company primarily engaged in the production and distribution of potable water in the Caribbean and the United States. The company operates through several segments, including water production, water retailing, and wastewater services. CWCO specializes in advanced desalination technologies and operates various water supply systems, providing essential services to residential, commercial, and governmental customers. Additionally, the company is involved in the development of water-related infrastructure projects, enhancing its service offerings.
How the Company Makes MoneyConsolidated Water Co. generates revenue through multiple streams, primarily from the sale of water to residential and commercial customers. The company operates water supply systems in various regions, charging customers based on consumption, which forms the bulk of its revenue. Additionally, CWCO earns income from its wastewater services and infrastructure projects, which may include construction contracts and consulting services in water management. The company also benefits from partnerships with local governments and private entities, allowing for expansion of its service areas and the implementation of new projects. Regulation and pricing agreements with local authorities further underpin its revenue stability, as these agreements often provide a predictable income stream.
Consolidated Water Co Earnings Call Summary
Earnings Call Date:Aug 11, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 17, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted steady revenue and earnings growth driven by the retail and manufacturing segments, a significant milestone in the Hawaii project, and a strong balance sheet. However, challenges remain with the bulk segment revenue decline, a decrease in services segment revenue, and ongoing receivables issues with the Bahamas government. Despite these challenges, the company's financial position and strategic initiatives point to a cautiously optimistic outlook.Q2-2025 Updates
Positive Updates
Revenue and Earnings Growth
Total revenues increased by 3% and fully diluted earnings per share from continuing operations increased by 23% compared to the same quarter of last year.
Retail and Manufacturing Segments
Retail revenue increased by 6%, and manufacturing revenue increased by 33% due to increased production and higher margin products.
Hawaii Project Milestone
Honolulu Board of Water Supply approved pilot test reports for the multiyear seawater desalination project, paving the way for construction to begin next year.
Strong Balance Sheet
Cash and cash equivalents grew to $112.2 million, with a working capital of $137.4 million and stockholders' equity at $216.6 million.
Dividend Increase
Quarterly cash dividend increased by 27% to $0.14 per share.
Negative Updates
Bulk Segment Revenue Decline
Caribbean-based bulk water segment revenue declined slightly due to lower fuel pass-through charges.
Services Segment Revenue Decrease
Services segment revenue decreased by $474,000 due to the completion of the pilot plant testing phase of the Hawaii project.
Net Income Decrease
Net income attributable to stockholders decreased to $5.1 million from $15.9 million in the second quarter of 2024 due to discontinued operations.
Bahamas Receivables
Ongoing issues with delayed payments from the Bahamas government, although recent progress in receiving payments was noted.
Company Guidance
During the second quarter of 2025, Consolidated Water Company reported a 3% increase in total revenues, reaching $33.6 million, and a 23% rise in fully diluted earnings per share from continuing operations compared to the same period last year. The retail segment saw a 6% revenue increase, while manufacturing surged by 33%, largely due to higher production and margin products. The bulk water segment experienced a slight revenue decline to $8.3 million, attributed to lower fuel pass-through charges, though profitability improved. The services segment revenue dropped by $474,000, mainly due to the completion of the pilot plant testing phase of the Hawaii project. O&M contracts in California and Colorado contributed to a 17% increase in recurring services revenue. The company ended the quarter with $112.2 million in cash and equivalents and a working capital of $137.4 million. Additionally, a quarterly dividend of $0.14 per share, marking a 27% increase, was declared. The construction phase of the Hawaii project is anticipated to be a major growth driver for the services segment in 2026 and 2027.Consolidated Water Co Financial Statement Overview
Summary
Consolidated Water Co demonstrates strong revenue growth and stable profitability, supported by a solid balance sheet with low leverage. However, the decline in free cash flow growth and net profit margin suggests potential challenges in maintaining liquidity and profitability. Overall, the company is financially stable with opportunities for improvement in cash flow management.Income Statement
Consolidated Water Co shows strong revenue growth with a TTM increase of 86.9%, indicating robust demand. The gross profit margin is stable at around 35%, and the net profit margin is healthy at 12.2% for TTM. However, the net profit margin has decreased from the previous year. EBIT and EBITDA margins are solid, reflecting efficient operations, though slightly lower than the previous year.75
Positive
Balance Sheet
The company maintains a very low debt-to-equity ratio of 0.016, indicating minimal leverage and financial stability. Return on equity is moderate at 7.4% for TTM, showing a decline from the previous year. The equity ratio is strong, suggesting a solid capital structure.80
Positive
Cash Flow
Operating cash flow is strong, but free cash flow has decreased significantly by 39.4% in TTM, which could impact future investments. The operating cash flow to net income ratio is close to 1, indicating good cash generation relative to net income. However, the free cash flow to net income ratio has declined, suggesting potential liquidity concerns.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 129.10M | 133.97M | 180.21M | 94.10M | 66.86M | 72.63M |
| Gross Profit | 45.26M | 45.62M | 61.93M | 30.36M | 23.51M | 26.77M |
| EBITDA | 26.02M | 27.47M | 44.72M | 15.97M | 10.57M | 16.34M |
| Net Income | 15.80M | 28.24M | 29.59M | 5.86M | 875.58K | 3.71M |
Balance Sheet | ||||||
| Total Assets | 257.50M | 243.31M | 218.44M | 193.01M | 177.03M | 179.56M |
| Cash, Cash Equivalents and Short-Term Investments | 112.25M | 99.35M | 42.62M | 50.71M | 42.86M | 43.79M |
| Total Debt | 3.48M | 3.46M | 2.67M | 2.47M | 2.94M | 1.61M |
| Total Liabilities | 35.30M | 28.00M | 26.61M | 25.24M | 10.69M | 10.54M |
| Stockholders Equity | 216.56M | 209.96M | 186.83M | 159.67M | 157.58M | 160.91M |
Cash Flow | ||||||
| Free Cash Flow | 20.95M | 29.82M | 2.92M | 13.79M | 5.48M | 15.61M |
| Operating Cash Flow | 30.13M | 36.52M | 7.97M | 21.33M | 6.97M | 17.34M |
| Investing Cash Flow | -8.76M | 26.96M | -10.89M | -4.98M | -3.94M | -11.12M |
| Financing Cash Flow | -7.15M | -6.71M | -5.52M | -6.30M | -5.86M | -5.17M |
Consolidated Water Co Technical Analysis
Positive
33.46
Price Trends
32.70
Positive
30.71
Positive
28.03
Positive
Market Momentum
0.18
Positive
48.99
Neutral
15.58
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CWCO, the sentiment is Positive. The current price of 33.46 is below the 20-day moving average (MA) of 33.99, above the 50-day MA of 32.70, and above the 200-day MA of 28.03, indicating a neutral trend. The MACD of 0.18 indicates Positive momentum. The RSI at 48.99 is Neutral, neither overbought nor oversold. The STOCH value of 15.58 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CWCO.
Consolidated Water Co Risk Analysis
Consolidated Water Co disclosed 21 risk factors in its most recent earnings report. Consolidated Water Co reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Consolidated Water Co Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $533.55M | 33.99 | 7.94% | 1.49% | -26.34% | -61.52% | |
73 Outperform | $988.21M | 22.76 | 9.70% | 2.40% | 11.91% | 16.88% | |
70 Outperform | $340.15M | 15.09 | 9.34% | 3.72% | 7.13% | 22.19% | |
70 Neutral | $2.76B | 20.24 | 8.49% | 2.61% | 0.62% | -24.24% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
66 Neutral | $295.34M | 48.55 | 8.96% | 2.82% | 4.33% | -13.38% | |
61 Neutral | $437.97M | 22.16 | 8.56% | 2.86% | 4.09% | -14.30% |
* Utilities Sector Average
CWCO
Consolidated Water Co
33.46
9.30
38.49%
ARTNA
Artesian Resources
33.03
-1.09
-3.19%
CWT
California Water Service
46.76
-3.35
-6.69%
MSEX
Middlesex Water Company
56.55
-4.06
-6.70%
YORW
The York Water Company
30.80
-3.91
-11.26%
GWRS
Global Water Resources
10.61
-1.10
-9.39%
Consolidated Water Co Corporate Events
Executive/Board ChangesShareholder Meetings
Consolidated Water Co Holds Annual Shareholder Meeting
Neutral
Jun 2, 2025
On May 27, 2025, Consolidated Water Co. Ltd. held its Annual General Meeting of Shareholders, where several key decisions were made. The meeting resulted in the election of directors, approval of executive compensation, and ratification of the appointment of CBIZ CPAs P.C. as the independent registered public accounting firm for the fiscal year ending December 31, 2025. These decisions are significant for the company’s governance and financial oversight, impacting its operational and strategic direction.
Executive/Board Changes
Consolidated Water Co Amends Executive Employment Terms
Neutral
Jun 2, 2025
On May 27, 2025, Consolidated Water Co. Ltd. amended its employment agreement with Douglas Vizzini, the Vice President of Finance and Assistant Company Secretary. The amendment allows the company to terminate the agreement with three months’ notice and a severance payment, aligning termination terms with legal requirements or Vizzini’s current salary.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.