American Water Works Company, Inc. (AWK)
Quantitative Summary
DeterministicAWK trades at 21.8x earnings, roughly in line with its sector average of 24.4x. Strong operational fundamentals (Piotroski 7/9) with Altman Z of 1.0. Beneish M-Score of -1.77 exceeds the -2.22 academic threshold — earnings quality may warrant further review.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of American Water Works reveal a tension between robust profitability metrics and capital efficiency constraints. While the DuPont decomposition highlights an impressive net margin of 21.6% driving returns, this is partially offset by low asset turnover at 0.14x, resulting in a negative ROIC-WACC spread of -2.5%. This indicates that current operations are destroying value relative to the cost of capital, despite maintaining a high equity multiplier of 3.27x which supports an overall ROE of 10.2%. Qualitative indicators present a mixed signal; the company demonstrates strong financial stability with a Piotroski F-Score of 7/9 and low earnings manipulation risk per the Beneish M-Score of -1.77, yet the Altman Z-Score of 1.0 suggests elevated distress risks compared to typical utility peers.
Valuation metrics position the stock in line with sector norms rather than at a distinct premium or discount. The current P/E ratio of 24.3x is virtually identical to the sector average of 24.2x, implying that market participants are pricing in standard growth expectations without significant valuation compression or expansion. However, this multiple does not fully account for the negative spread between returns and cost of capital noted earlier. The absence of provided DCF fair value data prevents a direct assessment of whether current prices reflect intrinsic value based on implied long-term cash flow projections, leaving the gap between market price and theoretical worth unspecified by the available figures.
Risk-adjusted performance analysis further complicates the investment case through factor-based exposures. The stock exhibits a negative Fama-French Alpha of -2.12% annually, suggesting underperformance relative to its risk factors over time, although it carries a positive Value Factor tilt (HML 0.200). Profitability exposure remains neutral with an RMW score of -0.028, and insider activity shows no directional bias with zero flow recorded over the last ninety days. Collectively, these data points suggest a company trading at fair value relative to peers but burdened by capital inefficiencies that may pressure future returns unless asset turnover improves or leverage is optimized.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
Valuation Context
Currently trading 1% below its 5-year average P/E of 24.4x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedAmerican Water Works Company, Inc. is currently trading at $124.29 within the Utilities sector, a position that reflects its established role in essential infrastructure services rather than high-growth speculative dynamics. The market environment for this asset suggests a focus on stability and predictable cash flows typical of utility equities, where price movements are often less volatile compared to cyclical industries. While specific drawdown metrics or volatility indices were not provided in the immediate data set, the current valuation level implies that recent momentum is likely driven by broader sector fundamentals such as regulated rate increases or demographic shifts affecting water demand, rather than isolated technical catalysts. The structural nature of this price point indicates that any upward movement may be supported by long-term operational resilience and regulatory tailwinds common to the sector, yet it remains susceptible to macroeconomic headwinds like rising interest rates which can compress valuations for income-focused stocks. Without explicit volatility data or recent drawdown figures, assessing the fragility of current momentum requires observing how this price level holds against potential market corrections in fixed-income sensitive sectors. The technical setup appears anchored by fundamental utility characteristics, suggesting that short-term fluctuations are more likely to be noise around a steady growth trajectory rather than signals of a structural trend reversal. Ultimately, the interplay between the sector's inherent defensive qualities and current pricing suggests a risk profile where downside protection is theoretically stronger due to essential service status, but upside potential may face headwinds from capital market conditions affecting dividend yields. The
Quant Health Deep Dive
Profitability & Value Creation
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-05-12 | $0.8950 | +8.1% |
| 2026-02-10 | $0.8280 | 0.0% |
| 2025-11-13 | $0.8280 | 0.0% |
| 2025-08-12 | $0.8280 | 0.0% |
| 2025-05-13 | $0.8280 | +8.2% |
| 2025-02-07 | $0.7650 | 0.0% |
| 2024-11-12 | $0.7650 | 0.0% |
| 2024-08-13 | $0.7650 | 0.0% |
| 2024-05-13 | $0.7650 | +8.1% |
| 2024-02-07 | $0.7080 | 0.0% |
| 2023-11-13 | $0.7080 | 0.0% |
| 2023-08-07 | $0.7080 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like XLU or VPU, the fund manager is mechanically forced to buy or sell AWK shares regardless of American Water Works Company, Inc.'s individual fundamentals. We estimate $4.1B of passive capital is structurally linked to AWK through 8 tracked ETFs. Index rebalances and ETF creation/redemption cycles can create noticeable volume spikes unrelated to company news.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in American Water Works Company, Inc. to visualize passive redemption contagion across ETFs and collateral stocks.
If American Water Works Company, Inc. (AWK) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies NEXTERA ENERGY INC (NEE) as the most exposed collateral stock, sharing 1 ETFs with AWK. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 28 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
AWK Ownership Dynamics
Passive funds hold 1 in every 6 AWK shares, reducing daily market volatility.
American Water Works Company, Inc. (AWK) exerts notable gravity on the passive index market, currently representing 1.7% of the State Street Utilities Select Sector SPDR ETF (XLU) and 1.6% of the VPU (VPU). Across 28 tracked ETFs, approximately 33M shares (16.9% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest AWK Exposure
Float lock-up computed from 28 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
AWK Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for American Water Works Company, Inc. over the past year sits near $130.01 (8% of 252-day volume). The current price of $123.68 sits 4.9% below the POC — suggesting potential mean-reversion upside if institutional demand reasserts at this level.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
AWK Capital Efficiency
How efficiently does American Water Works Company, Inc. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
American Water Works Company, Inc. converts -42% of its EBITDA into free cash flow, negative FCF conversion — the company is consuming cash faster than it generates EBITDA, which is unsustainable long-term. The 142% reinvestment rate signals aggressive capacity expansion. However, the ROIC-WACC spread is negative (-2.4%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-14 | 45 | $127.37 | $5,731.65 |
| 2026-05-13 | 11,815 | $127.65 | $1.5M |
| 2026-05-11 | 104,948 | $125.05 | $13.1M |
| 2026-05-07 | 19 | $125.68 | $2,387.92 |
| 2026-05-06 | 4,914 | $126.05 | $619,409.7 |
| 2026-04-24 | 834 | $134.97 | $112,564.98 |
| 2026-04-15 | 3 | $133.39 | $400.17 |
| 2026-04-10 | 78 | $139.25 | $10,861.5 |
| 2026-04-08 | 213 | $135.37 | $28,833.81 |
| 2026-04-06 | 256 | $138.14 | $35,363.84 |
| 2026-04-01 | 73 | $136.09 | $9,934.57 |
| 2026-03-31 | 147 | $138.82 | $20,406.54 |
| 2026-03-30 | 1,197 | $136.86 | $163,821.42 |
| 2026-03-27 | 12,956 | $137.51 | $1.8M |
| 2026-03-25 | 4,840 | $133.58 | $646,527.2 |
| 2026-03-24 | 3,505 | $135.73 | $475,733.65 |
| 2026-03-23 | 978 | $135.79 | $132,802.62 |
| 2026-03-20 | 9,120 | $137.10 | $1.3M |
| 2026-03-18 | 36,351 | $138.23 | $5.0M |
| 2026-03-17 | 1,350 | $139.12 | $187,812 |
| 2026-03-16 | 2 | $139.69 | $279.38 |
| 2026-03-10 | 49,753 | $137.73 | $6.9M |
| 2026-03-09 | 299 | $137.49 | $41,109.51 |
| 2026-03-06 | 1,441 | $134.63 | $194,001.83 |
| 2026-03-03 | 14 | $135.44 | $1,896.16 |
| 2026-02-27 | 294 | $134.32 | $39,490.08 |
| 2026-02-13 | 423 | $128.37 | $54,300.51 |
| 2026-01-21 | 23,742 | $131.42 | $3.1M |
| 2026-01-16 | 921 | $133.35 | $122,815.35 |
| 2026-01-13 | 2,433 | $130.30 | $317,019.9 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| DUK | 0.646 | 0.538 | Moderate |
| ED | 0.644 | 0.526 | Moderate |
| WEC | 0.628 | 0.532 | Moderate |
| EXC | 0.594 | 0.493 | Moderate |
| CMS | 0.593 | 0.484 | Moderate |
| SO | 0.593 | 0.452 | Moderate |
| PNW | 0.587 | 0.490 | Moderate |
| ATO | 0.574 | 0.440 | Moderate |
| LNT | 0.568 | 0.528 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare AWK to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.