Using the industry peer median P/E multiple (trailing + forward), American Water Works Company, Inc. (AWK) has a fair value of $126.79 based on 7 comparable companies in the Regulated Water industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| American Water Works Company, Inc.AWK | 26,858 | 24.2x | 22.6x |
| The Southern CompanySO | 106,555 | 24.3x | 20.9x |
| DTE Energy CompanyDTE | 30,063 | 20.5x | 18.7x |
| Ameren CorporationAEE | 30,016 | 20.3x | 20.2x |
| FirstEnergy Corp.FE | 28,954 | 28.5x | 18.4x |
| PPL CorporationPPL | 28,163 | 23.4x | 19.2x |
| CenterPoint Energy, Inc.CNP | 27,672 | 26.5x | 22.2x |
| CMS Energy CorporationCMS | 23,386 | 21.6x | 19.7x |
| Industry Median | 23.4x | 19.7x | |
| (*) Profit after tax | 1,111 | 1,190 | |
| Equity Value | 26,029 | 23,418 | |
| (/) Outstanding shares | 195 | 195 | |
| Fair Price | $133 | $120 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.