York Water Co (NASDAQ: YORW)

Sector: Utilities Industry: Utilities - Regulated Water CIK: 0000108985
Market Cap 466.28 Mn
P/B 2.25
P/E 23.81
P/S 7.76
ROIC (Qtr) 6.73
Div Yield % 3.08
Rev 1y % (Qtr) 3.28
Total Debt (Qtr) 227.32 Mn
Debt/Equity (Qtr) 0.96
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About

Investment thesis

Bull case

  • Strong tangible asset base of 667.06M provides 2.93x coverage of total debt 227.32M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 31.60M provides strong 117.47x coverage of stock compensation 269000, indicating sustainable incentive practices.
  • Strong operating cash flow of 31.60M provides 2.49x coverage of SG&A expenses 12.70M, showing efficient operational cost management.
  • Robust tangible asset base of 667.06M provides 283.86x coverage of working capital 2.35M, indicating strong operational backing.
  • Tangible assets of 667.06M provide robust 88.89x coverage of other current liabilities 7.50M, indicating strong asset backing.

Bear case

  • Operating cash flow of 31.60M barely covers its investment activities of (52.85M), with a coverage ratio of -0.60, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 1000 against inventory of 3.12M, the 0 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Operating cash flow of 31.60M provides thin coverage of dividend payments of (12.49M) with a -2.53 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • High receivables of 11.28M relative to inventory of 3.12M (3.62 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (21.25M) provides weak coverage of capital expenditures of 52.85M, with a -0.40 ratio suggesting additional external financing needs for growth initiatives.

Peer comparison

Companies in the Utilities - Regulated Water
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 AWK American Water Works Company, Inc. 24.13 Bn 37.82 6.54 15.37 Bn
2 WTRG Essential Utilities, Inc. 6.86 Bn 45.52 9.97 7.98 Bn
3 AWR American States Water Co 2.79 Bn 47.69 6.18 0.92 Bn
4 CWT California Water Service Group 2.22 Bn 43.86 3.64 1.52 Bn
5 HTO H2O America 1.79 Bn 19.00 2.39 1.90 Bn
6 MSEX Middlesex Water Co 0.99 Bn 22.76 5.03 0.41 Bn
7 CWCO Consolidated Water Co. Ltd. 0.54 Bn 88.40 10.18 0.00 Bn
8 YORW York Water Co 0.47 Bn 23.81 7.76 0.23 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.89 1.15
EV to Cash from Ops. EV/CFO 26.82 23.08
EV to Debt EV to Debt 2.60 18.00
EV to EBIT EV/EBIT 23.90 23.85
EV to EBITDA EV/EBITDA 17.06 16.61
EV to Free Cash Flow [EV/FCF] EV/FCF -18.51 -20.94
EV to Market Cap EV to Market Cap 1.27 1.32
EV to Revenue EV/Rev 9.83 9.58
Price to Book Value [P/B] P/B 2.25 4.93
Price to Earnings [P/E] P/E 23.81 38.23
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.60 0.89
Dividend Payout Ratio % Div Payout % (Qtr) 63.10 56.90
Dividend per Basic Share Div per Share (Qtr) 0.88 1.13
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) -59.50 -14.77
Interest Coverage Int. cover (Qtr) 2.96 279.41
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -1.36 -66.90
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 0.00 15.05
Dividend Growth (1y) % Div 1y % (Qtr) 4.03 6.56
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 3.87 -2.63
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 2.03 0.44
EBIT Growth (1y) % EBIT 1y % (Qtr) -6.62 -4.60
EBT Growth (1y) % EBT 1y % (Qtr) -15.02 -5.63
EPS Growth (1y) % EPS 1y % (Qtr) -6.08 -4.34
FCF Growth (1y) % FCF 1y % (Qtr) 8.60 -313.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 2.67 349.72
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.12 0.18
Cash Payout Ratio Cash Payout (Qtr) 0.15 0.04
Cash Ratio Cash Ratio (Qtr) 0.00 0.68
Current Ratio Curr Ratio (Qtr) 1.15 1.38
Debt to Equity Ratio Debt/Equity (Qtr) 0.96 1.08
Interest Cover Ratio Int Coverage (Qtr) 2.96 279.41
Times Interest Earned Times Interest Earned (Qtr) 2.96 279.41
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 56.30 31.76
EBIT Margin % EBIT Margin % (Qtr) 38.15 17.86
EBT Margin % EBT Margin % (Qtr) 25.26 6.26
Gross Margin % Gross Margin % (Qtr) 71.10 53.31
Net Profit Margin % Net Margin % (Qtr) 26.10 2.23