| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 32 | 22.0x | 17.8x | Bottom tier | |
Growth | 48 | 5.1% | 7.1% | Around median | |
Quality | 37 | 4.8% | 4.5% | Bottom tier | |
Safety | 30 | 5.8x | 2.6x | Bottom tier | |
Capital Return | 41 | 2.59% | 2.12% | Around median | |
Momentum | 88 | 21.3% | 2.9% | Top tier | |
Sentiment | 89 | 4 | 3 | Top tier |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
H2O America provides regulated water services and invests in water infrastructure across four states, serving 1.6 million people. Its revenue model is based on recovering capital investments and approved costs through rate decisions and infrastructure surcharge mechanisms; in California, San Jose Water Company passes water supply costs through to customers without a profit margin, while the group seeks to earn a regulated return on qualifying assets included in the rate base.
In Q2 fiscal 2026, GAAP diluted earnings per share were $0.62, while adjusted earnings per share were $0.72 versus $0.75 in Q2 fiscal 2025. Fiscal year-to-date 2026 earnings per share reached $1.12 on a GAAP basis and $1.23 on an adjusted basis, with underlying adjusted net income growing 17% in the first half; however, a 19% increase in the average diluted share count weighed on per-share results. The latest available EDGAR filings, for Q1 fiscal 2026, showed revenue of $183.3 million, net income of $19.0 million, and earnings per share of $0.49, equivalent to a calculated net income margin of approximately 10.4%.
The growth mix increasingly depends on Texas, which represents 8% of the combined customer base, and management expects this to rise to 26% by 2029, driven by Quadvest, Cibolo Valley, and the Hill Country operations. Quadvest had more than 59,800 active connections at the end of June 2026, along with 99,000 contracted connections under development, making the Texas expansion an important focus alongside the established operations in California, Connecticut, and Maine.
Automated analysis for informational purposes only — not investment advice.
The analyst consensus is Buy, with an average price target of $66.67 and a target range of $60 to $72; the average is very close to the 52-week range high of $67.09, while the range low is $43.75. No stated earnings multiple is available in the provided data, so the valuation case depends heavily on executing the $2.7 billion investment plan, achieving the targeted 13% rate-base growth, and Quadvest becoming earnings-accretive starting in 2028, weighed against dilution and regulatory decision risks.
Figures in the text are as of 2026-08-31; the live price is shown at the top of the page.
Growth is based on rate relief, infrastructure investment, and expansion in Texas. In the first half of fiscal 2026, increased revenue added the equivalent of $0.70 per share, including $0.41 from rate relief and $0.06 from increased usage. The company also invested $207 million, representing 43% of its $483 million annual capital expenditure budget.
Quadvest served more than 59,800 active connections at the end of June 2026, up 10% during the first half, and has 99,000 contracted connections under development. H2O America expects the acquisition to help increase Texas's share of the combined customer base from 8% to 26% by 2029. However, management expects earnings accretion to begin in 2028, with 10%–20% dilution relative to the standalone plan due to depreciation and transaction-related factors.
Yes, management reaffirmed standalone adjusted diluted earnings per share guidance of $3.08–$3.18 for fiscal 2026. Adjusted earnings per share were $1.23 in the first half, or $1.29 after adding the net $0.06 impact resulting from the timing of the Quadvest-related equity raise. The company also maintained its long-term earnings per share compound annual growth target of 6%–8%.
The immediate risk centers on the company's ability to include infrastructure investments in the rate base on a timely basis. In Texas, the proposed decision recommended a $285 thousand revenue reduction instead of the requested $5.1 million increase under the SIC application because of documentation issues and the accounting treatment of retirements and replacements. If recovery is not allowed, the company intends to request the inclusion of approximately $40 million of used and useful investments in the general rate case during Q1 fiscal 2027.
In a normal rainfall year, San Jose Water Company relies on Valley Water for more than 90% of its supply, either through water purchases or groundwater extraction charges. Purchased-water rates increased at a 10% compound annual growth rate and extraction charges at 11% over ten years, and supply costs now represent $0.42 of every dollar paid by customers. The company passes these costs through without a profit margin and is evaluating a mobile water purification unit costing approximately $3 million that it aims to operate before a public demonstration in September 2027, alongside a regional desalination study.
The company raised $700 million in equity in March 2026, including a $400 million forward equity component, and used part of the proceeds to repay credit facilities and invest in short-term cash equivalents. It expects to raise between $100 million and $200 million in debt at the parent company and Texas entity levels to finance the approximately $530 million Quadvest transaction. The financing increased the average diluted share count by 19% in the first half of fiscal 2026, reducing earnings per share by $0.21 during the period.
