Thursday, October 02, 2014

This Flashlight Runs on Water: Time for Water Stocks?

Would you believe that there is a flashlight that doesn't need batteries installed? As a matter of fact, this flashlight runs only on water. It is called the Eton BlackoutBuddy H20 The Always-Ready Water-Activated Emergency Light and it can stay lit for 72 hours straight, just by dipping it in a small cup of water. It can be stored for ten years and can even be used underwater. It is even environmentally conscious, as it does not contain mercury, hexavalent chromium, cadmium, or lead. The product is expected to be released shortly.

So if we have water powering our flashlights, will water soon be powering our cars? How about our homes? How about investing in water? Obviously, water is a very valuable commodity. We need it to drink, to wash, to grow our crops, to use in industrial applications, and numerous other uses. And the source of water for consumer and commercial use either comes from government water districts, private companies, or several publicly traded water utility stocks.

One example is Connecticut Water Service (CTWS) which serves over 120,000 customers in Connecticut and Maine. The stock trades at 17 times both trailing and forward earnings. For the latest quarter, earnings spiked by a huge 73.8% on a 12.9% revenue rise. The company, which is over half a century old, pays a healthy 3.1% yield.

Another example is The York Water Company (YORW), which has a trailing price to earnings ratio of 26 and a forward PE of 22. Earnings were up 17.7% for the latest quarter year-over-year on an increase of 9.6% in sales. The company is an old one, founded in 1816, and serves numerous municipalities in Pennsylvania. The stock pays a decent yield of 3.0%.

Several other water utilities are available to investors, such as American Water Works (AWK) which yields 2.6% and American States Water (AWR) paying 2.8%. The list of water utility stocks can be found at, which can be downloaded, sorted, and updated. Why not dip your toe into one of these companies. It may clench the thirst of your portfolio.

Disclosure: Author did not own any of the above at the time of publication and has no plans to do so in the next 72 hours.


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