Head to Head Survey: AquaVenture (WAAS) & SJW Group (SJW)

AquaVenture (NYSE: WAAS) and SJW Group (NYSE:SJW) are both small-cap utilities companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, risk, valuation and institutional ownership.

Analyst Recommendations

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This is a breakdown of recent recommendations for AquaVenture and SJW Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AquaVenture 0 0 4 0 3.00
SJW Group 0 0 1 0 3.00

AquaVenture presently has a consensus price target of $21.75, suggesting a potential upside of 75.12%. Given AquaVenture’s higher possible upside, research analysts plainly believe AquaVenture is more favorable than SJW Group.

Volatility and Risk

AquaVenture has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500. Comparatively, SJW Group has a beta of 0.25, suggesting that its stock price is 75% less volatile than the S&P 500.

Profitability

This table compares AquaVenture and SJW Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AquaVenture -21.29% -7.19% -4.79%
SJW Group 15.21% 10.57% 3.19%

Insider and Institutional Ownership

35.8% of AquaVenture shares are owned by institutional investors. Comparatively, 55.1% of SJW Group shares are owned by institutional investors. 55.9% of AquaVenture shares are owned by company insiders. Comparatively, 17.2% of SJW Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

SJW Group pays an annual dividend of $1.12 per share and has a dividend yield of 2.1%. AquaVenture does not pay a dividend. SJW Group pays out 49.6% of its earnings in the form of a dividend. SJW Group has raised its dividend for 50 consecutive years.

Earnings & Valuation

This table compares AquaVenture and SJW Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AquaVenture $121.15 million 2.71 -$25.79 million ($0.98) -12.67
SJW Group $389.23 million 2.78 $59.20 million $2.26 23.32

SJW Group has higher revenue and earnings than AquaVenture. AquaVenture is trading at a lower price-to-earnings ratio than SJW Group, indicating that it is currently the more affordable of the two stocks.

Summary

SJW Group beats AquaVenture on 10 of the 15 factors compared between the two stocks.

About AquaVenture

AquaVenture Holdings Limited provides water-as-a-service solutions in North America, the Caribbean, and South America. The company operates in two segments, Seven Seas Water and Quench. It offers desalination and wastewater treatment solutions for governmental, municipal, industrial, and hospitality customers; and point-of-use filtered water systems and related services to approximately 40,000 institutional and commercial customers. The company was founded in 2006 and is headquartered in Road Town, British Virgin Islands.

About SJW Group

SJW Group, through its subsidiaries, provides water utility services in the United States. It engages in the production, purchase, storage, purification, distribution, wholesale, and retail sale of water. The company also provides non-tariffed services, including water system operations, maintenance agreements, and antenna site leases. Its water supply consists of groundwater from wells, surface water from watershed run-off and diversion, reclaimed water, and imported water purchased from the Santa Clara Valley Water District. The company offers water service to approximately 230,000 connections that serve approximately 1 million people residing in portions of the cities of San Jose and Cupertino, as well as in the cities of Campbell, Monte Sereno, Saratoga, and the Town of Los Gatos; and adjacent unincorporated territories in the County of Santa Clara in the State of California. In addition, it provides water service to approximately 14,000 connections, which serve 42,000 people in a service area comprising 244 square miles in the region between San Antonio and Austin, Texas. Further, the company, through its subsidiary, SJW Land Company, owns undeveloped land in Tennessee; and owns and operates commercial buildings in Tennessee. The company was formerly known as SJW Corp. and changed its name to SJW Group in November 2016. SJW Group was founded in 1866 and is headquartered in San Jose, California.

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