At a glance
American Water Works is worth $29.35B, about 26 times its fiscal 2025 earnings. Revenue grew 9.7% to $5.14B in fiscal 2025, with 21.6% kept as profit; over 5 years it has grown 6.4% a year. It pays a 2.35% dividend yield, raised every year for at least 9 years, and returned $2.65B to shareholders in dividends and buybacks over FY2021–FY2025. The stock returned +17.9% over the past year with dividends reinvested and −1.5% a year over five years, against +11.5% and +11.7% for the S&P 500. At its worst it fell 31.2% in the 2020 crash (S&P 500: 33.7%) and 30.7% in the 2022 bear market (S&P 500: 24.5%).
The business in plain English
American Water Works is the largest publicly traded water and wastewater utility in the United States, by revenue and population served. It provides drinking water and wastewater services to about 14 million people in 24 states. Its regulated utilities, serving 3.6 million customers in 14 states, brought in 92% of operating revenue in fiscal 2025. Smaller businesses run water and wastewater systems on U.S. military bases and for municipalities.
The company owns the pipes, pumps, treatment plants and reservoirs, but usually not the water itself, which it draws under permits and contracts. State regulators called public utility commissions set the prices it may charge. After investing in its systems, it asks for higher prices through formal requests called rate cases. Homes are the biggest source of revenue: residential water made up 54% of regulated revenue in fiscal 2025, commercial water 21% and wastewater 9%.
Five states supplied 79% of regulated revenue in fiscal 2025: Pennsylvania (24%), New Jersey (23%), Missouri (12%), Illinois (12%) and California (8%). On October 26, 2025, the company agreed to combine with Essential Utilities in an all-stock deal, giving Essential shareholders 0.305 American Water shares for each Essential share. In its annual report filed February 18, 2026, the company expected the deal to close by the end of the first quarter of 2027.
Price history
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AWK +17.9% over the year to Nov 2, 2026, total return with dividends reinvested.
Latest results
- In Q3 FY2026 (ended Sep 30, 2026), revenue was $1.51B, up 3.9% from a year earlier, and net income was $387.0M (+2.1%).
- For fiscal 2025, revenue was $5.14B (+9.7% year over year; +6.4% a year from FY2020 to FY2025) with a 21.6% net margin.
Financial health check
| Revenue growth a year (FY2020–FY2025) | +6.4% good |
|---|---|
| Operating margin | 36.6% good |
| Free cash flow margin | -20.8% weak |
| Return on equity (FY2025) | 10.3% watch |
| Return on assets (FY2025) | 3.1% watch |
| Net cash (cash minus debt) | $-16.21B weak |
| Fiscal year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| FY2020 | $3.78B | $709.0M | $-396.0M |
| FY2021 | $3.93B | $1.26B | $-323.0M |
| FY2022 | $3.79B | $820.0M | $-1.19B |
| FY2023 | $4.23B | $944.0M | $-701.0M |
| FY2024 | $4.68B | $1.05B | $-811.0M |
| FY2025 | $5.14B | $1.11B | $-1.07B |
Valuation snapshot
| Market value | $29.35B |
|---|---|
| P/E ratio | 25.9 |
| Dividend yield | 2.35% |
Rank among 1514 US companies
Market value at each year end
American Water Works’s market value went from $12.88B at the end of 2016 to $29.35B on Nov 2, 2026, about 2.3 times as much; since the end of 2025 it is up 15%.
Show as a table
| Year end | Market value | Change |
|---|---|---|
| Nov 2, 2026 | $29.35B | +15.3% |
| 2025 | $25.46B | +5.0% |
| 2024 | $24.26B | -5.6% |
| 2023 | $25.70B | -7.3% |
| 2022 | $27.71B | -19.2% |
| 2021 | $34.29B | +23.2% |
| 2020 | $27.82B | +25.3% |
| 2019 | $22.21B | +35.5% |
| 2018 | $16.39B | +0.4% |
| 2017 | $16.32B | +26.7% |
| 2016 | $12.88B |
Price behavior
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | |
|---|---|---|---|---|---|
| AWK price data to Nov 2, 2026 | +15.3% | +17.9% | +8.4% | -1.5% | +9.5% |
Show as a table
| Year | Price data |
|---|---|
| 2026 (to date) | +15.3% |
| 2025 | +7.4% |
| 2024 | -3.5% |
| 2023 | -11.7% |
| 2022 | -17.9% |
| 2021 | +24.8% |
| 2020 | +26.9% |
| 2019 | +37.8% |
| 2018 | +1.3% |
| 2017 | +29.1% |
| 2016 | +23.6% |
| 2015 | +14.8% |
| 2014 | +29.4% |
| 2013 | +16.1% |
| 2012 | +20.6% |
| 2011 | +30.0% |
| 2010 | +17.3% |
| 2009 | +11.9% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Lost 30% over that stretch · deepest drop along the way 31.2%, back to its old high 3.8 months after the low |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Lost 30.7% over that stretch · deepest drop along the way 30.7%, not recovered by the end of the data |
Insider activity
Form 4 filings from 2025-10-29 to 2026-10-29 (23 read): 0 open-market purchases and 0 sales ($0.00).
Who owns it
Large shareholders (13G filings)
| BlackRock, Inc. | 10.1% | Dec 31, 2024 |
| Wellington Management Group LLP | 7.6% | Jun 30, 2026 |
| Vanguard Capital Management | 7.57% | Mar 31, 2026 |
| Vanguard Portfolio Management | 5.79% | Mar 31, 2026 |
ETFs with the most weight in AWK
| AQWA Global X Clean Water ETF | 9.4% |
| CGW Invesco S&P Global Water Index ETF | 8.98% |
| FTRI First Trust Indxx Global Natural Resources Income ETF | 6.54% |
| EFRA iShares Environmental Infrastructure and Industrials ETF | 6.34% |
| CWS AdvisorShares Focused Equity ETF | 4.97% |
| PHO Invesco Water Resources ETF | 4.8% |
| FIW First Trust Water ETF | 4.4% |
| TBLU Tortoise Global Water ESG Fund | 4.33% |
What could go wrong
- The Essential merger may not pay off. Essential holders get a fixed 0.305 shares per Essential share, whatever prices do. The deal may not lift earnings per share, could bring big costs and integration problems, and will shrink existing holders' ownership stake.
- State regulators decide what it can charge. Public utility commissions set its rates. The delay between investing and winning higher rates, called regulatory lag, can squeeze earnings. Regulators can also impose fines, penalties and other sanctions.
- Big spending needs and heavy debt. Free cash flow (operating cash minus capital spending) was negative $1,067 million in fiscal 2025, and total debt was $16.3 billion as of September 30, 2026. Rising interest rates would make funding costlier.
- Drought and weather can limit water sales. Drought, government restrictions, protection of threatened species or contamination can limit supplies. Seasonal weather affects how much water customers use, and storms or other disasters can disrupt service.
- Contamination and stricter water-quality rules. A contamination event could force service limits and bring lawsuits, enforcement and reputational harm. Rules on newer pollutants, called contaminants of emerging concern, could raise operating costs and capital spending.
- Aging pipes and dams can fail. Old mains, reservoirs and dams can break, causing outages, property damage and costly repairs. A dam failure, or a requirement to repair, upgrade or remove one, could hurt finances and reputation.
Recent events
- Quarterly results released
- Other company announcement
- Investor presentation or announcement
- Quarterly results released
- Investor presentation or announcement
- Other company announcement
- Other company announcement
- Other company announcement
- Executive or board change; Bylaws or fiscal year changed; Shareholder vote results; Other company announcement
- Quarterly results released
For income and retirement investors
American Water has raised its dividend for at least nine straight fiscal years through fiscal 2025, and the true streak may be longer. Dividends per share rose from $2.20 in fiscal 2020 to $3.31 in fiscal 2025, about 8.5% a year, and took 57% of fiscal 2025 earnings. The yield was 2.48% as of October 28, 2026. The catch: free cash flow (operating cash minus capital spending) was negative every year from fiscal 2020 to 2025, so the dividend depends on outside funding. It repurchased no shares from fiscal 2021 to 2025, and its share count grew 9.7% between October 2021 and October 2026.
In the 2020 COVID crash the stock fell 31.2%, then recovered by July 17, 2020. In the 2022 bear market it dropped 30.7% and had not regained its January 2022 peak as of October 28, 2026. A single stock carries more risk than a diversified fund.
Questions investors ask
How does American Water Works make money?
It charges homes, businesses and public bodies for drinking water and wastewater service, at prices approved by state public utility commissions. Its regulated utilities in 14 states produced 92% of operating revenue in fiscal 2025. Within that, residential water brought in 54%, commercial water 21% and wastewater 9%. Smaller units run water systems on U.S. military bases and for municipalities. Customer growth comes mainly from acquiring other water and wastewater systems and from population growth in its service areas.
Does American Water Works raise its dividend every year?
Yes, so far. It has raised its dividend for at least nine straight fiscal years through fiscal 2025, and the true streak may be longer. Dividends per share grew from $2.20 in fiscal 2020 to $3.31 in fiscal 2025, about 8.5% a year, and equaled 57% of fiscal 2025 earnings. Its annual report cautions that it cannot promise to keep paying at the same rate or to keep raising the dividend as planned.
What is the American Water and Essential Utilities merger?
It is a planned all-stock combination agreed on October 26, 2025. Essential shareholders would receive 0.305 American Water shares for each Essential share, and Essential would become a wholly owned subsidiary. American Water would keep its name and its headquarters in Camden, New Jersey. In its annual report filed February 18, 2026, the company estimated closing by the end of the first quarter of 2027. Existing American Water shareholders would own a smaller slice of the larger company, and the deal may not add to earnings per share.
How has American Water Works stock performed?
Mixed. As of October 28, 2026, the share price was up about 8.9% a year over 10 years, or 135% in total, but down 2.3% a year over five years. It fell 17.9% in calendar 2022, 11.7% in 2023 and 3.5% in 2024, then rose 7.4% in 2025. These figures are based on the share price. The dividend yield was 2.48% on the same date.
How much debt does American Water Works have?
A lot, which is common for utilities that build and maintain pipes and plants. As of September 30, 2026, total debt was $16.3 billion, against $121 million of cash and investments and $11.9 billion of shareholders' equity. Capital spending outpaces the cash the business generates, so free cash flow was negative $1,067 million in fiscal 2025. The company's annual report warns that higher interest rates or trouble raising money could hurt results.