Consolidated Water (CWCO) Increases Yet Falls Behind Market: What Investors Need to Know

In the latest close session, Consolidated Water (CWCO) was up +2.27% at $34.69. The stock's performance was behind the S&P 500's daily gain of 2.51%. Elsewhere, the Dow saw an upswing of 2.85%, while the tech-heavy Nasdaq appreciated by 2.8%.

The stock of developer and operator of desalination plants has fallen by 1.68% in the past month, lagging the Utilities sector's loss of 0.05% and the S&P 500's loss of 1.66%.

The upcoming earnings release of Consolidated Water will be of great interest to investors. In that report, analysts expect Consolidated Water to post earnings of $0.27 per share. This would mark a year-over-year decline of 12.9%. Meanwhile, the latest consensus estimate predicts the revenue to be $33.4 million, indicating a 0.95% decrease compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $1.07 per share and revenue of $143.99 million, which would represent changes of -7.76% and +9.02%, respectively, from the prior year.

Any recent changes to analyst estimates for Consolidated Water should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 31.85% downward. Consolidated Water is currently a Zacks Rank #5 (Strong Sell).

In terms of valuation, Consolidated Water is presently being traded at a Forward P/E ratio of 31.7. This represents a premium compared to its industry average Forward P/E of 21.17.

The Utility - Water Supply industry is part of the Utilities sector. At present, this industry carries a Zacks Industry Rank of 181, placing it within the bottom 26% of over 250 industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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