Global Water Resources on Monday rose as much as 2.3% to $13.29 a share after analysts at Janney started covering the Arizona utility with a Buy rating.
Global Water’s revenue will rise 11% from this year to $49 million in 2023, Janney forecast. It estimated that Q3 EPS will be $0.04 on $11 million in revenue.
Global Water’s total customer connections expanded 8.8% in the second quarter from a year earlier amid growth in housing and industrial users.
Its water supply isn’t a concern amid this year’s declines in reservoirs such as Lead Mead and Lake Powell to historical lows.
Global Water’s “portfolio of groundwater water supply assets provides confidence that the company can meet its obligations to current and future customers as its service territory expands,” Michael Gaugler, analyst at Janney, said in the report.
The water utility also obtained from the Arizona Corporation Commission to set new water and wastewater rates for 96% of active service connections. The new rates are expected to add $2.2 million in yearly revenue after being phased in over the next year and a half.
Janney set a fair value target for Global Water of $17 a share.
Global Water has fallen 23% this year, compared with a 20% decline for the Russell 2000 Index ( RTY ).
Seeking Alpha contributor Ian Bezek rates Global Water ( NASDAQ: GWRS ) as a Strong Buy on Arizon's economic growth .
For further details see:
Global Water rises after Janney starts coverage with Buy rating