AWR · Utilities(water supply) · 10 years of annual accounts filed with the SEC · latest fiscal year ended 2025-12-31
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American States Water Co reported revenue of $658.1 million in fiscal 2025, after growing 4.6% a year over the previous 9 years. Its operating margin widened from 28.8% in 2017 to 30.9%, and it earned 8.5% on its invested capital in the latest year. Of the $1.2 billion its operations generated over 10 years, 119.2% went back into the business and 38.1% to dividends; the share count rose 5.0%. On the accounting screens, it passes 6 of 9 Piotroski tests, its Altman Z'' of 2.04 is in the grey zone and its Beneish M-score is below the -1.78 line; 1 of the six cross-checks between its statements fires.
Revenue, fiscal 2025658.1M+4.6% a year over 9 years
Operating margin30.9%gross margin 90.8%
Return on invested capital8.5%9.4% on average over 5 years
Free cash flow after stock pay-10.7M-1.6% of revenue
Net debt ÷ EBITDA3.0×net debt 763.9M
Piotroski F-score6/9tests of improvement passed
Is it growing?
Revenue and the operating income it turns into. Growth that does not reach operating income is growth bought with margin.
RevenueOperating income
0200M400M600M800M
2017Revenue 440.6MOperating income 127.1M
2018Revenue 436.8MOperating income 101.0M
2019
2019Revenue 473.9MOperating income 127.1M
2020Revenue 488.2MOperating income 130.5M
2021Revenue 498.9MOperating income 141.0M
2022Revenue 491.5MOperating income 126.6M
2023Revenue 595.7MOperating income 196.7M
2024Revenue 595.5MOperating income 184.5M
2025Revenue 658.1MOperating income 203.3M
2017201820192019202020212022202320242025
Compound growth a year
3 yrs
5 yrs
9 yrs
Revenue
+10.2%
+6.2%
+4.6%
Operating income
+17.1%
+9.3%
+5.4%
Net income
+18.5%
+8.6%
+7.3%
Earnings per share
+16.8%
+7.6%
+6.7%
Dividend per share
+8.3%
+8.6%
+7.7%
Shares
+1.4%
+0.9%
+0.5%
Falling shares are buybacks: each remaining share owns more of the company.
Does it earn more than its capital costs?
Margins say how much of each sale is kept; return on invested capital says how much the business earns on the money it needs to operate. Growth only creates value when that return is above the cost of the capital.
Needs a cost of capital, which comes from the valuation below.
Return on equity
12.5%
Return on assets
4.8%
Asset turnover
0.24×
Overheads (SG&A)
15.6% of revenue
Is the profit cash, and where does the cash go?
Net income is an accounting opinion; free cash flow is what was left in the bank after investing. Stock-based pay does not leave the bank — shareholders pay it through dilution — so it is shown taken off as well.
Net incomeFree cash flowAfter stock-based pay
-200M-100M0100M200M
2017Net income 69.4MFree cash flow 31.4MAfter stock-based pay 28.5M
2018Net income 63.9MFree cash flow 10.2MAfter stock-based pay 6.4M
2019
2019Net income 84.3MFree cash flow -35.1MAfter stock-based pay -37.6M
2020Net income 86.4MFree cash flow -8.3MAfter stock-based pay -10.7M
2021Net income 94.3MFree cash flow -28.9MAfter stock-based pay -31.5M
2022Net income 78.4MFree cash flow -48.4MAfter stock-based pay -51.0M
2023Net income 124.9MFree cash flow -120.9MAfter stock-based pay -124.2M
2024Net income 119.3MFree cash flow -33.2MAfter stock-based pay -37.0M
2025Net income 130.4MFree cash flow -7.1MAfter stock-based pay -10.7M
2017201820192019202020212022202320242025
Where 10 years of operating cash went, 2017–2025
1.2B generated by the business. Each band is its share of that total.
Reinvested in the business 119%1.5B
Acquisitions 0%0
Dividends 38%476.2M
Share buybacks 0%0
More than it generated: funded with cash or new debt -57%-716.4M
Over the same years it paid 27.5M in stock. The share count rose 5.0%.
Per share
Earnings per shareFree cash flow per shareDividend per share
-$4-$2$0$2$4
2017Earnings per share $1.88Free cash flow per share $0.85Dividend per share $0.99
2018Earnings per share $1.73Free cash flow per share $0.28Dividend per share $1.05
2019
2019Earnings per share $2.28Free cash flow per share $-0.95Dividend per share $1.16
2020Earnings per share $2.34Free cash flow per share $-0.22Dividend per share $1.28
2021Earnings per share $2.55Free cash flow per share $-0.78Dividend per share $1.40
2022Earnings per share $2.12Free cash flow per share $-1.31Dividend per share $1.52
2023Earnings per share $3.37Free cash flow per share $-3.26Dividend per share $1.65
2024Earnings per share $3.17Free cash flow per share $-0.88Dividend per share $1.78
2025Earnings per share $3.37Free cash flow per share $-0.18Dividend per share $1.93
2017201820192019202020212022202320242025
Shares outstanding
Diluted shares
36.5M37.0M37.5M38.0M38.5M39.0M
2017Diluted shares 36.8M
2018Diluted shares 36.9M
2019
2019Diluted shares 37.0M
2020Diluted shares 37.0M
2021Diluted shares 37.0M
2022Diluted shares 37.0M
2023Diluted shares 37.1M
2024Diluted shares 37.6M
2025Diluted shares 38.7M
2017201820192019202020212022202320242025
Debt and liquidity
Debt is not bad in itself; debt the business cannot service in a bad year is. Net debt is debt minus cash, and below zero the company holds more cash than it owes.
Net debt
0200M400M600M800M
2017Net debt 321.1M
2018Net debt 314.3M
2019
2019Net debt 280.0M
2020Net debt 403.6M
2021Net debt 407.2M
2022Net debt 440.6M
2023Net debt 561.5M
2024Net debt 613.7M
2025Net debt 763.9M
2017201820192019202020212022202320242025
Net debt ÷ EBITDA
3.0×
Interest coverage
4× operating income ÷ interest
Current ratio
1.32 current assets ÷ current liabilities
Cash conversion cycle
— collects in 21d
Three classic screens of the accounts
Each asks a different question of the same statements — is it improving, does it look like a company heading for distress, do the accounts resemble ones that were manipulated. None is a verdict; each shows what moves it.
Piotroski F-score
Is the business improving? Nine yes-or-no tests, this year against last.
6of 9 tests passed
✓ProfitableReturn on assets above zeropassed
✓Cash from operationsOperating cash flow above zeropassed
✓Profitability improvedReturn on assets higher than a year beforepassed
✓Profit backed by cashOperating cash flow above net income (low accruals)passed
✕Less long-term debtLong-term debt as a share of assets fellfailed
✓More liquidCurrent ratio higher than a year beforepassed
✕No new sharesShare count did not growfailed
✕Better gross marginGross margin higher than a year beforefailed
✓Sells more per assetAsset turnover higher than a year beforepassed
Where it misleads: it measures change, not level. An excellent business that stood still for a year scores low; a poor one recovering from a disaster scores high.
Altman Z''-score
Does the balance sheet look like those of companies that went bankrupt?
2.04grey zone
1.12.6
Working capital ÷ assets 0.02 × 6.56+0.14
Retained earnings ÷ assets 0.23 × 3.26+0.74
Operating income ÷ assets 0.07 × 6.72+0.50
Equity ÷ liabilities 0.63 × 1.05+0.66
Where it misleads: buybacks. A company that returns so much cash that its equity turns small or negative sinks the last two ratios without being anywhere near bankruptcy. Banks and insurers do not fit the model at all.
Beneish M-score
Do the accounts resemble those of companies that manipulated their earnings?
-2.59below the -1.78 line
-1.78
Receivables vs sales 0.92+0.85
Gross margin slipping 1.00+0.53
Soft assets 1.03+0.42
Sales growth 1.11+0.99
Slower depreciation 1.00+0.11
Overheads vs sales 0.92-0.16
Profit not in cash -0.04-0.17
Leverage rising 0.95-0.31
Where it misleads: fast growth and acquisitions. Sales growth carries a heavy weight, so a company growing 50% a year scores like a suspect without having done anything. It is a screen from a 1999 study, not an accusation.
Where the statements disagree
Cross-checks between the income statement, the balance sheet and the cash flow for the latest year, each with the benign reading and the worrying one.
Net debt is 3.0 times EBITDA.
Benign
A stable sector with predictable cash flows and comfortable maturities.
Worrying
Little room if earnings fall; the maturity schedule is what to check.
What is it worth, under which assumptions?
A company is worth the cash it will generate, brought back to today. This model projects revenue with growth that fades over the years, applies a free cash flow margin, and discounts the result at the cost of capital. Every assumption says where it came from, and all of them can be changed.
With a free cash flow margin at or below zero in year ten, the business never generates cash for its owners and a DCF says nothing useful. Set a positive margin for year ten to see what it would take.
What it has filed lately
The last twelve months at the SEC, most important first: annual and quarterly reports, events, large holders and insiders.
Every Form 4 filed in the last twelve months, read line by line: 6 filings by 5 people. Open-market purchases and sales are counted apart from awards, option exercises and shares withheld for taxes.
Bought on the open market—none in the period
Sold on the open market$178,4913 sale(s) by 2 insider(s)
Under pre-arranged plans0%of the sales followed a 10b5-1 plan set months earlier
A Form 4 says what happened, when, how many shares and at what price. It does not say why: a sale can be diversification, a tax bill or a plan fixed months earlier, and an award is pay, not a purchase. Nothing here is a reason to buy or sell anything.
Which large funds report holding it
From the Form 13F of the 28 institutions followed on this site, as of the end of their last reported quarter. A 13F is filed up to 45 days later and shows only long positions in US-listed shares.
Accounts from the company's own SEC filings; lines some companies do not report are shown as a dash rather than estimated. The risk-free rate is the 10-year US Treasury yield. A DCF is a way of making assumptions explicit, not a forecast: it states what the company would be worth if the assumptions held. The scores are screens that point where to look, not verdicts. Nothing here is a recommendation to buy or sell.
