American Water's (AWK) Unit to Invest $2.22M in Water Mains
American Water Works AWK recently announced that its unit, New Jersey American Water, is going to invest $2.22 million for improving the water mains in Camden County. The company plans to replace more than 2 miles of aging 6-inch water main with new 6-inch and 8-inch ductile iron main, and six fire hydrants as well as 158 utility-owned service lines along the pipeline route. All these upgrades will ensure an increase in water flow for customers and adequate supply of water for fire fighters.
New Jersey American Water regularly invests to upgrade, maintain, and expand the existing water and wastewater infrastructure. This project is part of the multi-million-dollar initiative to improve the resilience of its infrastructure. This unit of American Water is quite active in upgrading its water and wastewater infrastructure and has already announced total projects worth nearly $8.9 million in different areas of its service territories since the beginning of this month.
Aging Water Infrastructure Needs Investment
The U.S. water infrastructure, which includes more than 2.2 million miles of pipelines, is aging and needs major repair and maintenance to provide proper services to millions of Americans. Per the Water and Wastewater Equipment Manufacturers Association, an estimated $750 billion investment is necessary to maintain and expand drinking water as well as wastewater services to meet demand over the next 20 years.
Per the findings of the American Society of Civil Engineers, water main breaks occur every two minutes in the United States due to aging of the existing water infrastructure. Pipeline breaks result in the wastage of 6 billion gallons of potable water each day and add to the loss of water utility operators. The pipeline breaks not only increase the cost of water services but also expose it to the possibility of contamination.
It is evident that massive investment is essential to improve the quality of water and wastewater services in the United States. The U.S. government, through the “American Jobs Plan”, unveiled that it will invest $111 billion for the aging water and wastewater infrastructure over the next 10-year period. Definitely, these investments will be helpful for upgrading the aging infrastructure but the requirement is larger.
In addition, investor-owned water utilities like American Water Works, Essential Utilities WTRG and California Water Services CWT, among others, are making substantial investments on an annual basis to upgrade as well as maintain the aging infrastructure. Middlesex Water MSEX — under the Water for Tomorrow program — is making regular capital investments to enhance system reliability, resiliency and overall service quality.
Price Performance
Shares of American Water have outperformed the industry in the past year.
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Zacks Rank
American Water currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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American Water Works Company, Inc. (AWK) : Free Stock Analysis Report
California Water Service Group (CWT) : Free Stock Analysis Report
Middlesex Water Company (MSEX) : Free Stock Analysis Report
Essential Utilities Inc. (WTRG) : Free Stock Analysis Report
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