When long term droughts seem on the rise, and the municipalities that provide water to their constituents seem to lack the proper funding to upgrade their infrastructures, a national crisis might be inevitable. Add to that the newly revived need for extensive amounts of water due to hydrofracking, it might be time to invest in water stocks.
Obviously, you can look at the best water softener reviews on http://watersoftenerguide.com/, but that won’t open your eyes to the necessity of investing in water stocks. Sure, it will help you regulate and maintain the best drinking water for your family or office, but you need to dive deeper into the topic. You will need some information on the most highly recommended water stocks on the market.
Stocks That Will Make a Splash
Investing in utility stocks, particularly those attached to private water utilities, could best be considered a defensive tactic. This is especially true since the government can regulate the growth and profits realized by these entities. Research shows that the water industry can generate revenues that exceed $135 billion, yearly.
The demand for water has been on the rise in recent years and as the US seeks to provide itself with oil, that increase on demand for water is only going to continue. Unfortunately, most municipalities don’t have the ability to improve on their functionality, and will therefore require the assistance of others. The following three companies are rising to the occasion and are worthy of your investment considerations:
- Aqua America (WTR)- They are growing aggressively through their acquisitions and have managed to build a 24 mile private pipeline to provide water for oil drilling in western Pennsylvania. They joined forces with Penn Virginia Resource Partners (PVR Water Services) near the end of 2011. WTR serves more than 3 million customers in more than 13 states ranging from Pennsylvania to Texas. And, their market value in 2012 was $3.7 billion.
- American Water Works (AWK)- This US based water and wastewater utility is the largest one that is investor-owned. And, its 2012 market worth was $6.5 billion! The regulated utility markets help create nearly 90% of its revenue. AWK services more than 15 million industrial, residential, and commercial clients. Learn more about this A rated company.
- American States Water (AWR)- This is a significantly smaller company only worth $778 million in 2012. But, it serves California’s water customers and even provides electric services to a small portion of San Bernardino County. But, its 2012 dividend yield was 2.7%. Watch what is happening with this company by clicking this.
The three companies mentioned previously are a great place to start, but since that information is slightly old, you might want to consider this 2016 list of water stocks to invest in:
- SJW Corporation- A+ rated company
- Connecticut Water Service Inc.- Rated A
- Middlesex Water Company- A- ranking
- Consolidated Water Company Inc.- B rated company
- York Water Company- Rated B
- California Water Service GP- B ranking
- Artesian Resources- B rated
Stock market investing can be a bit daunting, but if you are ready to take the leap, it’s time to dive into water stocks. Your portfolio could be greatly impacted by this highly desired resource. Read more about investing in the stock market here.