American Water Works reported higher adjusted earnings for the third quarter and raised the lower end of its 2026 earnings outlook, narrowing the forecast to the top half of its previous range. The water and wastewater utility also set initial standalone earnings guidance for 2027, projecting about 8% growth, and said its proposed merger with Essential Utilities continues to advance.
Key details
- Third-quarter earnings: Adjusted earnings were $2.00 per share, up from $1.89 a year earlier. GAAP earnings were unchanged at $1.94 per share.
- Year-to-date results: Through September, adjusted earnings were $4.63 per share, compared with $4.40 in 2025. GAAP earnings were $4.56 per share, up from $4.47.
- 2026 outlook: The company narrowed its adjusted earnings guidance to $6.07–$6.12 per share, from $6.02–$6.12. It said its long-term targets remain unchanged.
- 2027 outlook: Initial standalone adjusted earnings guidance is $6.53–$6.63 per share. The company characterized that range as roughly 8% growth.
- Rates and regulation: American Water said it made significant regulatory progress during the year, including in Pennsylvania and New Jersey, where new rates took effect in the third quarter.
- Investment and customer growth: Its $3.7 billion capital investment plan for 2026 remains on track. Acquisitions added about 81,000 customer connections through September 30, including connections from the Nexus Water systems.
- Essential Utilities merger: The proposed merger has received approval in three states, and settlements have been reached in Pennsylvania, North Carolina and Texas. The announcement did not identify the three states that have approved the transaction.
What changes for investors
The updated 2026 forecast raises the minimum expected adjusted earnings while leaving the top end unchanged. The 2027 range is explicitly standalone guidance, so it presents the company’s earnings outlook apart from the proposed merger with Essential Utilities. New rates in Pennsylvania and New Jersey are already in effect, while the merger continues through state regulatory processes.