by Fred Fuld III
Many years ago, I began investing in water utility stocks. I assumed that any company that can sell something that is ubiquitous as water, must have a great business. It ended up that all the water stocks I purchased got bought out by another company, at a much higher price than what I paid for it.
Water utilities don’t pay as high a dividend yield as electric utilities or gas utilities, but there are several water utility stocks with yields over 1.7% to 4.0%. Here are a few of these stocks.
American Water Works Company (AWK) is a $29.1 billion market cap water utility which yields 1.5%. The company provides water and wastewater services in 16 states. The stock has a trailing price to earnings ratio of 40.5 and a forward PE of 37.7.
California Water Service Group (CWT) provides water utility services in California, Washington, New Mexico, and Hawaii. This $3 billion market cap company trades at 26 times trailing earnings and 33 times forward earnings. It pays a dividend yield of 1.56%.
Middlesex Water Company (MSEX), a $1.5 billion company, provides water services in New Jersey, Delaware, and Pennsylvania. The stock trades at 41 times trailing earnings and 39.5 times forward earnings. The stock yields 1.24%.
The York Water Company (YORW), based in Pennsylvania, is a $685 million company. It has a trailing PE of 42 and a forward PE of 39.5. The yield is 1.43%.
I might be all wet but one of these water companies might just clench your portfolio thirst for dividends.
Disclosure: Author owns CWT.