American States Return On Equity vs. Profit Margin

AWR Stock  USD 78.34  1.17  1.47%   
Based on American States' profitability indicators, American States' profitability may be sliding down. It has an above-average probability of reporting lower numbers next quarter. Profitability indicators assess American States' ability to earn profits and add value for shareholders.
 
Return On Equity  
First Reported
2010-12-31
Previous Quarter
0.16095806
Current Value
0.17
Quarterly Volatility
0.03347864
 
Credit Downgrade
 
Yuan Drop
 
Covid
At this time, American States' Price To Sales Ratio is relatively stable compared to the past year. As of 12/24/2024, EV To Sales is likely to grow to 6.83, while Sales General And Administrative To Revenue is likely to drop 0.14. At this time, American States' Operating Income is relatively stable compared to the past year. As of 12/24/2024, Net Income is likely to grow to about 131.2 M, while Net Income Applicable To Common Shares is likely to drop slightly above 51.2 M.
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.580.7547
Way Down
Very volatile
Net Profit Margin0.220.2097
Sufficiently Up
Slightly volatile
Operating Profit Margin0.20.3303
Way Down
Slightly volatile
Pretax Profit Margin0.140.2795
Way Down
Slightly volatile
Return On Assets0.02830.0556
Way Down
Pretty Stable
Return On Equity0.170.161
Notably Up
Slightly volatile
For American States profitability analysis, we use financial ratios and fundamental drivers that measure the ability of American States to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well American States Water utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between American States's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of American States Water over time as well as its relative position and ranking within its peers.
  

American States' Revenue Breakdown by Earning Segment

Check out Trending Equities.
Is Water Utilities space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of American States. If investors know American will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about American States listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
0.117
Dividend Share
1.756
Earnings Share
2.96
Revenue Per Share
15.516
Quarterly Revenue Growth
0.066
The market value of American States Water is measured differently than its book value, which is the value of American that is recorded on the company's balance sheet. Investors also form their own opinion of American States' value that differs from its market value or its book value, called intrinsic value, which is American States' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because American States' market value can be influenced by many factors that don't directly affect American States' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between American States' value and its price as these two are different measures arrived at by different means. Investors typically determine if American States is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, American States' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

American States Water Profit Margin vs. Return On Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining American States's current stock value. Our valuation model uses many indicators to compare American States value to that of its competitors to determine the firm's financial worth.
American States Water is rated second in return on equity category among its peers. It is rated below average in profit margin category among its peers fabricating about  1.43  of Profit Margin per Return On Equity. At this time, American States' Return On Equity is relatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value American States by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

American Profit Margin vs. Return On Equity

Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

American States

Return On Equity

 = 

Net Income

Total Equity

 = 
0.13
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Profit Margin measures overall efficiency of a company and shows its ability to withstand competition as well as defend against adverse conditions such as rising costs, falling prices, decline in sales or management distress. Profit margin tells investors how well the company executes on its overall pricing strategies as well as how effective the company in controlling its costs.

American States

Profit Margin

 = 

Net Income

Revenue

X

100

 = 
0.19 %
In a nutshell, Profit Margin indicator shows the amount of money the company makes from total sales or revenue. It can provide a good insight into companies in the same sector, as well as help to identify trends of a company from year to year.

American Profit Margin Comparison

American States is currently under evaluation in profit margin category among its peers.

American States Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in American States, profitability is also one of the essential criteria for including it into their portfolios because, without profit, American States will eventually generate negative long term returns. The profitability progress is the general direction of American States' change in net profit over the period of time. It can combine multiple indicators of American States, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Operating Income196.7 M206.6 M
Net Income124.9 M131.2 M
Income Tax Expense41.6 M43.7 M
Income Before Tax166.5 M174.8 M
Total Other Income Expense Net-30.2 M-28.7 M
Net Income Applicable To Common Shares90.2 M51.2 M
Net Income From Continuing Ops124.9 M81.4 M
Non Operating Income Net Other2.8 M3.7 M
Interest Income7.4 M3.8 M
Net Interest Income-35.3 M-37.1 M
Change To Netincome10.5 M9.1 M
Net Income Per Share 3.38  3.55 
Income Quality 0.54  0.51 
Net Income Per E B T 0.75  0.50 

American Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on American States. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of American States position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the American States' important profitability drivers and their relationship over time.

Use American States in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if American States position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in American States will appreciate offsetting losses from the drop in the long position's value.

American States Pair Trading

American States Water Pair Trading Analysis

The ability to find closely correlated positions to American States could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace American States when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back American States - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling American States Water to buy it.
The correlation of American States is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as American States moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if American States Water moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for American States can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your American States position

In addition to having American States in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Transportation Thematic Idea Now

Transportation
Transportation Theme
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Transportation theme has 61 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Transportation Theme or any other thematic opportunities.
View All  Next Launch

Additional Tools for American Stock Analysis

When running American States' price analysis, check to measure American States' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy American States is operating at the current time. Most of American States' value examination focuses on studying past and present price action to predict the probability of American States' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move American States' price. Additionally, you may evaluate how the addition of American States to your portfolios can decrease your overall portfolio volatility.