Aqua America (
), a major water utility, has retaken its 10-week moving average
and is building a new base.
The company offers a combination of steady capital gains and
dividend growth. The stock is up 25% this year and 23% over the
past 52 weeks, outpacing the S&P 500.
The Bryn Mawr, Pa.-based utility serves residential and
commercial customers in 10 states, mostly in the East and South.
Like rivals such asAmerican Water Works (
), Aqua America has been growing through acquisitions.
"Large operators like Aqua America find it easier to expand
their footprint via strategic acquisitions," Zacks Equity
Research said in a July 2 note.
"We believe consolidation in a way will help the water
utilities to generate incremental revenue and invest more towards
the maintenance and development of old water systems," said
Zacks, which has a "buy" rating on the stock.
The company has a 97 Earnings Per Share Rating, reflecting
double-digit earnings and sales growth or better in recent
First-quarter profit jumped 53%, though that was down from the
prior quarter's 130% gain. Second-quarter earnings are seen
slowing further, to a still-respectable 23%.
Revenue growth has ranged between 10% and 12% over the past
four quarters. For all of 2013, Aqua America's earnings are
expected to rise 7% to $1.41 a share.
Meanwhile, Aqua America has paid a dividend for more than 65
years. In May, it increased the quarterly payout by 8% to 19
cents a share. That's 76 cents a share annually, good for a yield
The stock is working on the right side of a new base after
retaking its 50-day line Monday. It had previously run up 23%
after breaking out in January from a 27.03 flat-base buy