Essential Utilities Inc. (WTRG) is a regulated utility holding company serving five million people in Pennsylvania, Ohio, Texas, Illinois, North Carolina, New Jersey, Indiana, Virginia, West Virginia, and Kentucky under the Aqua and Peoples brands.
The company generated 59% of its revenue from natural gas, 33% from water, 5% from wastewater, and remaining from other sources during the first quarter of 2021. The majority of these revenues came from residential and commercial sources, but the company also generated income from fire protection, industrial, and other sources.
Mixed Q1 Financial Results
Essential Utilities reported first-quarter revenue that rose 128.3% to $583.57 million, missing consensus estimates by $73.35 million, with non-GAAP earnings of 72 cents per share, beating consensus estimates by six cents. Management expects full-year net income per diluted share of between $1.64 and $1.69 per share.
Despite the top-line miss, the company has drawn the attention of many investors due to its healthy payout ratio in the 60% range and its solid 3.7 interest coverage ratio during the first quarter.
The company raised its quarterly dividend by 7% to $0.2682 per share, representing a 2.22% forward yield. The dividend is payable on September 1, 2021, to shareholders on record as of August 13, 2021.
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