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American Water Works Co. (0HEW) fair value: what the stock is really worth

As of Oct 2, 2026: fair value of American Water Works Co. $64.01, price $130, upside -50.8%, quality 45 out of 100. Calculated from audited financials with 26 valuation models and 37 quality factors, updated daily.

  1. Fair value above price? No
  2. Good quality? No
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Industrials · GB · Home US

AW Some data Sep 24, 2026

American Water Works Co.

0HEW · LSE

Weakest SetupStrongly overvalued and low quality.

!Fair value $64.01 · Strongly overvalued (−50.8%)
!Quality 45/100
!Mixed Growth (revenue 5y +6.4 %/yr)
✓Highly profitable · 21.2% net margin (TTM)
!Moderate debt · negative free cash flow
!2.5% dividend yield · Watch coverage
✓Ranks above peers (6/10)
✓Wide moat 67/100
!Evidence only medium, so the estimate is less certain
!Weak on future: 29 out of 100
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What runs behind every stock

26 valuation models 8 families, DCF to NCAV 37 quality factors margins, balance sheet, cashflow, debt 6 AI factors moat, what no ratio measures 2,000+ data points verified, per stock, median

69 individual criteria per stock, every one traceable See the method →

Price vs Fair Value

$171.39 $108.38 Fair Value $64.01 Mar 2021 Oct 2026

White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Sep 24, 2026.

How to read this chart

60‑month range $108.38 – $171.39 · fair‑value band $52.93 – $99.09 · the $130.20 price screens above the $64.01 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). 1 fiscal year is left out: there the valuation rested on only a fraction of the usual models. Dashed = 300-day average. As of Sep 24, 2026.

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Company profile

American Water Works Company, Inc., through its subsidiaries, provides water and wastewater services in the United States. It offers water and wastewater services on military installations; and undertakes contracts with municipal customers, primarily to operate and manage water and wastewater facilities, as well as offers other related services.

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American Water Works Company, Inc., through its subsidiaries, provides water and wastewater services in the United States. It offers water and wastewater services on military installations; and undertakes contracts with municipal customers, primarily to operate and manage water and wastewater facilities, as well as offers other related services. The company also operates approximately 80 surface water treatment plants; 520 groundwater treatment plants; 170 wastewater treatment plants; 55,000 miles of transmission, distribution, and collection mains and pipes; 1,200 groundwater wells; 1,800 water and wastewater pumping stations; 1,100 treated water storage facilities; and 75 dams. In addition, it offers water and wastewater services to 14 states serving approximately 3.6 million active customers. The company serves residential customers; commercial customers, including food and beverage providers, commercial property developers and proprietors, and energy suppliers; fire service and private fire customers; industrial customers, such as large-scale manufacturers, mining, and production operations; public authorities comprising government buildings and other public sector facilities, such as schools and universities; and other utilities and community water and wastewater systems. The company was founded in 1886 and is headquartered in Camden, New Jersey.

Stock analysis

American Water Works Co. (0HEW) currently trades at $130.20, while our model-based Fair Value estimate is $64.01, 50.8% below the price, so the stock looks overvalued today.

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Valuation

Bull case: the Growth Earnings group reads highest at a median of $110.24 per share, and 1 of the 16 models we run sit above the $130.20 price.

Bear case: the Earnings-Based group reads lowest at $33.34, and 15 of the 16 models stay below the price. Evidence for this calculation is medium.

Scenario range: $52.93 (bear) to $99.09 (bull), the price of $130.20 sits above it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.

Quality & growth

The Quality Score stands at 45/100 (below-average quality), in the Industrials sector.

Mixed Growth: Revenue is growing, but margins or cash flow do not fully confirm the trend.

American Water Works Co. reported revenue of $5.1B in FY2025 versus $3.9B in FY2021, a compound +6.9%/yr. Reported net income was $1.1B in FY2025, compounding −3.2%/yr from FY2021.

Key figures

Market cap $25.4B · P/E ratio 0.2 · P/S ratio 0.04 · EPS (TTM) $7.07 · Dividend yield 2.5% · Net margin 21.6% · Return on equity 10.2% · Return on assets (EBIT) 4.9%.

Competitive moat

Our AI-assisted moat analysis scores the competitive advantage at 48 out of 100 (low confidence).

What moves the price

The share trades about 8% below its 52-week high and 7% above its 52-week low, currently below its 200-day average.

For context, the median of 10 Industrials peers we cover trades at −40% fair-value upside, at −51%, 0HEW screens richer than that median.

Fair Value models

Bear $52.93 Fair Value $64.01 Bull $99.09
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above is their evidence-weighted blend, not the output of a single model. Based on fiscal year 2025 figures (about 9 months old). Earnings retained since then ($2.84 per share) are deliberately not added. Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. If a model's bull case is above four times its base value, the table shows that limit with a > sign (like the overall Bull above): beyond it no assumption holds. Evidence ⓘEvidence = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Highest evidence
Residual Income $52.65 $58.20 $71.00 76
EPV $27.91 $40.37 $51.12 73
ROIC Compounder $27.91 $40.37 $51.12 72
All 16 models by family
Earnings-Based
Graham-Dodd $41.83 $116.33 $152.88 65
Lynch FV $23.34 $33.34 $43.35 61
PEG = 1.0 $23.34 $33.34 $43.35 57
EPV $27.91 $40.37 $51.12 73
Dividend Discount
Gordon GGM $30.78 $61.34 $92.88 67
DDM Multi-Stage $30.78 $47.71 $64.75 66
Multiples
P/E Multiple $96.89 $129.19 $161.48 63
P/S Multiple $42.69 $56.92 $71.15 58
P/B Multiple $78.43 $104.58 $130.72 55
EV/EBIT $81.64 $125.85 $170.07 65
EV/EBITDA $98.69 $148.59 $198.49 66
EV/Revenue n/a $0.2100 >$0.8400 50
Asset-Based
NCAV (Graham) $30.00 $40.20 $60.01 54
Economic Profit
Residual Income $52.65 $58.20 $71.00 76
ROIC Compounder $27.91 $40.37 $51.12 72
Growth Earnings
Growth-Adj P/E $77.17 $110.24 $143.31 67

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Quality Score breakdown

Overall quality 45/100

Of which business quality 42 · Market factors (momentum, volatility) 52

Profitability 36
Margins and returns on capital today
Quality Growth 44
Are margins and returns improving?
Cashflow 48
Earnings quality: real cash, not paper profit
Fin. Strength 30
Balance sheet, leverage, solvency risk
Investment 32
Disciplined investing over empire-building
Low Volatility 87
Calm price path (market factor)
Momentum 38
Price trend over the last 3–12 months (market factor)
52W Momentum 36
Distance to the 52-week high (market factor)
Net Issuance 70
Share count: buybacks or dilution?

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Revenue & earnings trend

Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card. 31/100
Revenue is growing, but margins or cash flow do not fully confirm the trend.
Revenue growth 1 year
+9.7%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+10.7%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+6.4%
Start year 2020 (pandemic). Over 10 years: +5.0% a year
Revenue growth 40 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+6.4%
What shareholders gained per year (last 5 years) ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate.
+10.4%
Earnings growth per share plus dividend.
Earnings per share, growth per year+7.9%
Dividend (yield on the price)2.5%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.7.9% vs 8.1%, steady
Profit margin 2020 to 2025 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.33% → 37%
Start year 2020 (pandemic)

0HEW screens overvalued: fair value 51% below the price. Compare with Contemporary Amperex Technology Co →

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Peer GroupⓘHow this stock ranks against its sector: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median. (Industry “Water Utilities” was too small, so the broader sector is used.)Industrials · 5305 stocks

Beats the sector median on 6/10 measures
Overall it ranks above its sector peers.
Valuation
Quality Score 45 · Below median
Fair Value upside −50.8% · Below median
Profitability
Return on equity (TTM) 10.2% · Above median
Return on assets 3.5% · Above median
Net margin (TTM) 21.2% · Top 25%
Operating margin (TTM) 33.2% · Top 25%
Growth and dividend
Revenue growth 5.7% · Below median
Dividend yield (TTM) 2.5% · Above median
Balance sheet
Debt / equity 0.86× · Highest 25%

Valuation Multiplesvs Industrials median · lower = cheaper

P/E (TTM) 0.2× · Cheapest 25%

Strength profile in five axes (Snowflake)

VALUEFUTUREPASTHEALTHDIVIDEND
This stock
VALUEFUTUREPASTHEALTHDIVIDEND
Sector peers
VALUE (fair-value potential)0 · sector 17
FUTURE (revenue growth)29 · sector 36
PAST (return on equity)41 · sector 29
HEALTH (low debt)57 · sector 94
DIVIDEND (yield)51 · sector 37

VALUE 0: the price sits above our fair-value range.

Context: sector, industry, market

Values & ESG

Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.

None of the checked exposures detected

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American Water Works Co. · Fair Value
$64.01 −51%Fair Value
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Cite: Fair Value Calculator (2026). "American Water Works Co. Fair Value". https://www.fairvalue-calculator.com/stock/0HEW

Frequently asked questions

Is American Water Works Co. (0HEW) overvalued or undervalued?
As of Sep 24, 2026, our model estimates a fair value of $64.01 versus a price of $130.20, about −51% upside (overvalued).
What is the fair value of 0HEW?
Our model-based fair value for American Water Works Co. is $64.01 (as of Sep 24, 2026), built from audited fundamentals. The current price: $130.20.
What is the quality score of 0HEW?
American Water Works Co. has a Quality Score of 45/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for American Water Works Co. (0HEW)?
Our model-based price target is the fair value of $64.01 (as of Sep 24, 2026) from 16 valuation models. Cautious scenario $52.93, optimistic scenario $99.09. It is a calculation from audited fundamentals, not an analyst target.
What is the American Water Works Co. stock forecast for 2026?
Our models put fair value at $64.01, about −51% upside versus a price of $130.20 (overvalued). Cautious scenario $52.93, optimistic scenario $99.09. The calculation is refreshed regularly with new filings.
What is the revenue of American Water Works Co. (0HEW)?
American Water Works Co. reported trailing-twelve-month revenue of about $5.2B (latest available figure, as of Sep 24, 2026).
Does American Water Works Co. pay a dividend?
American Water Works Co. currently shows a dividend yield of about 2.54% relative to its recent price (as of Sep 24, 2026).
What is the intrinsic value of American Water Works Co. (0HEW)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For American Water Works Co. it is $64.01 per share (as of Sep 24, 2026), against a price of $130.20. It is the blended result of 16 valuation models (cash flow, earnings, asset, dividend).
Is American Water Works Co. stock overvalued or undervalued in 2026?
As of Sep 24, 2026, 0HEW trades above its calculated fair value: price $130.20, fair value $64.01, a gap of about −51% (overvalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of 0HEW?
No. The price is what the market pays today ($130.20); the fair value is what the company's own numbers justify ($64.01). For American Water Works Co. the two are $66.19 per share apart. That gap is exactly why we show both numbers side by side.
How much is American Water Works Co. worth?
The market values American Water Works Co. at about $25.4B (market capitalisation, as of Sep 24, 2026). Per share that is $130.20; our models calculate a fair value of $64.01 per share.
What do the bullish and bearish scenarios say about 0HEW?
Our models span a range for American Water Works Co.: cautious scenario $52.93, base $64.01, optimistic $99.09 per share (as of Sep 24, 2026, price $130.20). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of 0HEW?
American Water Works Co. trades at a price-to-earnings ratio of 0.2 (as of Sep 24, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of $64.01 is built from several models across several years.
How solid is the balance sheet of American Water Works Co. (0HEW)?
Balance-sheet figures for American Water Works Co. (as of Sep 24, 2026): return on equity 10.2%, debt of 0.86 per unit of equity. They feed the Quality Score of 45/100, which measures business quality independently of the share price.
How far is 0HEW from its 52-week high?
American Water Works Co. trades at $130.20, about 8% below its 52-week high of $142.24 and 7% above the low of $121.19 (as of Oct 2, 2026). Distance from the high says nothing about value: that is what the fair value of $64.01 is for.
Which stocks are comparable to American Water Works Co.?
From the same area (Industrials) we also value Contemporary Amperex Technology Co, Delta Electronics (Thailand) Public Company, Larsen & Toubro Limited, Samsung C&T Corporation, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is American Water Works Co. stock attractive at the current price?
The data as of Sep 24, 2026: price $130.20, calculated fair value $64.01 (−51%), Quality Score 45/100, from 16 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of 0HEW calculated?
We run American Water Works Co. through 16 models from four families: discounted cash flow, earnings models, asset and balance-sheet models, and dividend models. Every model gets the same audited fundamentals; the result is the weighted average of $64.01, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 14.5 % above its aggregate fair value. American Water Works Co. itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of American Water Works Co. (0HEW)?
The closing price on Oct 2, 2026 was $130.20. Our model-based fair value is $64.01, about −51% upside (overvalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with American Water Works Co. right now?
The price sits above even our optimistic bull case ($99.09). The favourable scenario is already priced in. Solid but not exceptional quality (45/100) and above fair value, neither a clear bargain nor a standout compounder. A fairly wide model range ($52.93 to $99.09) leaves room in how you read the outcome.
Where does the earnings growth of American Water Works Co. (0HEW) come from?
Earnings per share at American Water Works Co. grew +8.6 % a year from 2014 to 2025. Broken into its drivers: revenue per share +3.6 %, EBIT margin +0.9 %, tax rate +2.9 %, residual (interest, one-offs) +1.0 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.

Key figures of American Water Works Co.

How large is the market capitalisation of American Water Works Co. (0HEW)?
The market capitalisation of American Water Works Co. is $25.4B. The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of American Water Works Co. (0HEW)?
The price-to-sales ratio of American Water Works Co. is 0.04 (P/E × margin). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of American Water Works Co. (0HEW)?
Earnings per share at American Water Works Co. are $7.07 (price ÷ EPS = P/E 0.2). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of American Water Works Co. (0HEW)?
The dividend yield of American Water Works Co. is 2.5% (payout 46.8%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of American Water Works Co. (0HEW)?
The net margin of American Water Works Co. is 21.6% (fiscal year 2025). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of American Water Works Co. (0HEW)?
The return on equity (ROE) of American Water Works Co. is 10.2% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of American Water Works Co. (0HEW)?
On an EBIT basis the return on assets of American Water Works Co. is 4.9% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of American Water Works Co. (0HEW)?
The operating margin of American Water Works Co. is 33.2% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at American Water Works Co. (0HEW)?
Revenue at American Water Works Co. is growing +5.7% versus a year earlier (3y avg +10.7%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at American Water Works Co. (0HEW)?
Earnings per share at American Water Works Co. are growing −4.8% versus a year earlier. How much earnings per share grew versus a year earlier.
How much free cash flow does American Water Works Co. (0HEW) generate?
The free cash flow of American Water Works Co. is −$1.1B (fiscal year 2025). The cash truly left after running and investing in the business, this is what pays dividends and buybacks.
How much net debt does American Water Works Co. (0HEW) carry?
The net debt of American Water Works Co. is $15.9B (fiscal year 2025). Debt minus cash on hand. The note shows how many years of free cash flow could in theory pay it off.
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