AquaVenture Holdings (NYSE: WAAS) and California Water Service Group Holding (NYSE:CWT) are both utilities companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, institutional ownership, earnings and dividends.

Profitability

This table compares AquaVenture Holdings and California Water Service Group Holding’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AquaVenture Holdings -22.56% -7.34% -5.08%
California Water Service Group Holding 10.46% 10.31% 2.75%

Valuation and Earnings

This table compares AquaVenture Holdings and California Water Service Group Holding’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
AquaVenture Holdings $114.10 million 3.36 -$20.47 million ($1.01) -14.37
California Water Service Group Holding $609.37 million 3.42 $48.67 million $1.42 30.56

California Water Service Group Holding has higher revenue and earnings than AquaVenture Holdings. AquaVenture Holdings is trading at a lower price-to-earnings ratio than California Water Service Group Holding, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for AquaVenture Holdings and California Water Service Group Holding, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AquaVenture Holdings 0 0 4 1 3.20
California Water Service Group Holding 2 5 0 0 1.71

AquaVenture Holdings presently has a consensus price target of $22.00, suggesting a potential upside of 51.62%. California Water Service Group Holding has a consensus price target of $33.00, suggesting a potential downside of 23.96%. Given AquaVenture Holdings’ stronger consensus rating and higher probable upside, equities research analysts plainly believe AquaVenture Holdings is more favorable than California Water Service Group Holding.

Dividends

California Water Service Group Holding pays an annual dividend of $0.72 per share and has a dividend yield of 1.7%. AquaVenture Holdings does not pay a dividend. California Water Service Group Holding pays out 50.7% of its earnings in the form of a dividend. AquaVenture Holdings has increased its dividend for 49 consecutive years.

Insider & Institutional Ownership

37.9% of AquaVenture Holdings shares are owned by institutional investors. Comparatively, 68.1% of California Water Service Group Holding shares are owned by institutional investors. 55.9% of AquaVenture Holdings shares are owned by company insiders. Comparatively, 1.0% of California Water Service Group Holding shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

California Water Service Group Holding beats AquaVenture Holdings on 9 of the 16 factors compared between the two stocks.

AquaVenture Holdings Company Profile

AquaVenture Holdings Limited is a multinational provider of Water-as-a-Service solutions. The Company’s segments are Seven Seas Water and Quench. The Seven Seas Water segment provides outsourced desalination solutions and wastewater treatment for governmental, municipal, industrial and hospitality customers. The Quench segment provides bottleless filtered water coolers and other products that use filtered water as an input, such as ice machines, sparkling water dispensers and coffee brewers, to customers throughout the United States typically under multi-year contracts. The Company’s solutions utilize seawater reverse osmosis and other purification technologies to produce potable and industrial process water in high volumes for customers operating in regions with limited access to potable water. As of December 31, 2016, it operated 10 water treatment facilities in the Caribbean region and South America producing approximately eight billion gallons of purified water per year.

California Water Service Group Holding Company Profile

California Water Service Group is a holding company. The Company operates through the supply and distribution of water and providing water-related utility services segment. The Company, through its subsidiaries, provides non-regulated services and non-regulated services to private companies and municipalities. The bulk of the business consists of the production, purchase, storage, treatment, testing, distribution and sale of water for domestic, industrial, public and irrigation uses, and for fire protection. It also provides non-regulated water-related services. The non-regulated services include water system operation, billing and meter reading services. Non-regulated operations also include the lease of communication antenna sites, lab services and promotion of other non-regulated services. The Company under its non-regulated contract arrangements, operates municipally owned water systems, privately owned water and recycled water distribution systems.

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