Brean Capital Upgrades American States Water (AWR) to Buy

September 17, 2013 7:57 AM EDT Send to a Friend
Get Alerts AWR Hot Sheet
Price: $33.82 -0.5%

Rating Summary:
    1 Buy, 3 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 24 | Down: 28 | New: 14
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Brean Capital upgraded American States Water (NYSE: AWR) from Hold to Buy with a price target of $28.00.

Analyst Michael Gaugler said, "The shares have fallen to a price level that we now consider attractive, and our sum-of-the-parts valuation indicates fair value is $28 based on our 2014 EPS forecasts. We recommend investors begin accumulating positions under the $25.50 price level to allow sufficient (10%) upside (excluding dividends) to our target price."

"We acknowledge that the current environment for utility stocks in terms of interest rate impacts is less than ideal. However, we note the shares of AWR (and our other utility coverage names) have traded at higher P/E multiples when the general level of interest rates was much higher. We see the impact of higher rates as short term and negligible, particularly when we look closely at AWR's ability to continue to raise its dividend payout versus the peer group by using free cash flow from the ASUS business," he added.

For an analyst ratings summary and ratings history on American States Water click here. For more ratings news on American States Water click here.

Shares of American States Water closed at $25.22 yesterday.


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