American Water (AWK) Q3 2026 Earnings Report

The call was predominantly positive. Management reported year-over-year EPS growth, narrowed 2026 guidance toward the top half of the initial range, initiated 2027 guidance reflecting 8% growth, reaffirmed 7% to 9% long-term growth targets, and highlighted substantial regulatory, capital deployment, customer growth and merger progress. The main challenges were higher operating and other costs, pending regulatory decisions, the gap between the Illinois revenue request and proposed amount, California desalination cost and approval issues, and the absence of consolidated post-merger guidance.

American Water now expects to achieve the top half of its initial EPS guidance range for 2026, narrowed to $6.07 to $6.12 per share; it initiated stand-alone adjusted earnings guidance for 2027 of $6.53 to $6.63 per share, reflecting 8% stand-alone EPS growth over 2026, and affirmed long-term targets of 7% to 9% EPS and dividend per share growth through 2031 and beyond, with or without Peoples. The company expects the merger to close by the end of the first quarter of 2027, expects 2027 investment of $4.1 billion, inclusive of acquisitions, more than $20 billion through 2030 and more than $48 billion through 2035, and its current financing plan for calendar year 2027 includes $2 billion to $3 billion of long-term debt financing; $1.5 billion of equity is anticipated in 2029. It also cited a 2027 revenue component of $1.70 to $1.80, an updated California desalination total cost estimate of $825 million plus AFUDC, and approximately 81,000 customer connections added across 10 states.