Water is an essential commodity, like gold and oil. It is a critical natural resource on the planet that seems to be depleting. Therefore, investors have the opportunity to invest in water through stocks of water utility companies. These stocks are known as water stocks.
Water, as a resource, is becoming scarce in recent times. We all knows how necessary water is; we need it for agriculture, food, and much more. Due to the water shortage, water stocks have become interesting and attractive investment avenues. The companies that top the list of water stocks include the water bottling companies as due to the lack of clean drinking water, water bottling companies are gaining significance. The next on the list is the water treatment and distribution companies.
Water stocks have been performing well in the past few years, with 2019 as a solid year. Water stocks have outperformed the broader market to a large extent.
|AWK||American Water Works Company, Inc.||$156.61||-0.57%||28.5B|
|SBS||Companhia de Saneamento Basico do Estado de Sao Paulo - SABESP||$10.40||50.72%||36.6B|
|AWR||American States Water Company||$97.91||9.16%||3.6B|
|CWT||California Water Service Group||$62.67||3.59%||3.4B|
|MSEX||Middlesex Water Company||$89.55||-7.33%||1.6B|
|YORW||The York Water Company||$46.42||7.38%||662.7M|
|ARTNA||Artesian Resources Corporation||$61.59||32.31%||578.4M|
|PCYO||Pure Cycle Corporation||$9.55||-22.61%||229.1M|
|GWRS||Global Water Resources, Inc.||$14.80||-3.71%||353.2M|
|CWCO||Consolidated Water Co. Ltd.||$15.37||55.25%||235.0M|
|AOS||A.O. Smith Corporation||$69.05||-6.80%||10.5B|
|AQUA||Evoqua Water Technologies Corp.||$49.26||18.84%||6.0B|
|BMI||Badger Meter, Inc.||$121.05||20.60%||3.5B|
|AQN||Algonquin Power & Utilities Corp.||$7.36||-47.91%||6.7B|
|ERII||Energy Recovery, Inc.||$22.95||20.73%||1.3B|
|FELE||Franklin Electric Co., Inc.||$93.87||11.17%||4.3B|
|GRC||The Gorman-Rupp Co.||$28.94||-26.60%||755.2M|
|MLI||Mueller Industries, Inc.||$70.19||26.35%||4.0B|
|MWA||Mueller Water Products, Inc.||$13.99||11.03%||2.2B|
|ROP||Roper Technologies, Inc.||$430.34||-6.74%||45.6B|
|TTC||The Toro Co.||$113.69||17.56%||11.8B|
|TTEK||Tetra Tech, Inc.||$155.27||5.67%||8.3B|
|VMI||Valmont Industries, Inc.||$323.67||52.44%||6.9B|
|WTS||Watts Water Technologies, Inc.||$172.10||14.50%||5.7B|
|WTTR||Select Energy Services, Inc.||$8.37||11.75%||1.0B|
Examples of Water Stocks
Water stocks refer to companies involved in the provision of water-related services, such as treatment, distribution, and infrastructure development. These stocks can provide investors with a way to invest in the growing demand for clean and safe water, as well as the infrastructure needed to meet that demand.
Here are some of the top water stocks to consider:
- American Water Works (AWK) – American Water Works is the largest publicly traded water and wastewater utility company in the United States. The company operates in 16 states, providing clean water and wastewater services to over 14 million people. American Water Works has a strong track record of steady growth and is well positioned to benefit from the ongoing need for infrastructure investment in the water sector.
- Roper Technologies (ROP) – Roper Technologies is a diversified technology company with a significant presence in the water industry. The company’s water segment provides a range of products and services, including water treatment systems and software, to both industrial and municipal customers. Roper Technologies has a strong balance sheet and a history of consistent earnings growth, making it a solid choice for investors.
- Xylem Inc (XYL) – Xylem is a leading global water technology company, providing a range of products and services for the transportation, treatment, and testing of water. The company operates in more than 150 countries and serves a wide range of customers, including municipalities, industrial companies, and residential users. Xylem has a strong track record of growth and is well positioned to benefit from the increasing demand for water infrastructure and technology.
- Pentair PLC (PNR) – Pentair is a global water treatment company that provides a range of products and services to industrial and municipal customers. The company operates in more than 150 countries and serves a wide range of industries, including power, oil and gas, and food and beverage. Pentair has a strong balance sheet and a history of consistent earnings growth, making it a solid choice for investors.
- SUEZ (OTCPK:SZEVY) – SUEZ is a global leader in sustainable resource management, providing a range of services and solutions for water, waste, and energy management. The company operates in over 70 countries and serves a wide range of customers, including municipalities, industrial companies, and residential users. SUEZ has a strong track record of growth and is well positioned to benefit from the increasing demand for sustainable water and waste management solutions.
About the Water Industry
The water industry is a vast and diverse sector that encompasses a wide range of activities related to the provision, treatment, and management of water resources. This includes activities such as water supply and distribution, wastewater treatment, and the development of water infrastructure. The industry also includes companies that provide equipment, technologies, and services related to water management, such as water treatment systems and software.
One of the key drivers of the water industry is the growing demand for clean and safe water. This demand is driven by a variety of factors, including population growth, urbanization, and industrialization. As populations continue to grow and urban areas expand, the need for clean and reliable water supply and infrastructure becomes increasingly important.
Another key driver of the water industry is the need for sustainable water management. Climate change and increasing water scarcity are putting pressure on governments and companies to find ways to manage water resources more efficiently and sustainably. This has led to the development of new technologies and services for water conservation, reuse, and recycling.
The water industry can be divided into several sub-segments, such as the water utility sector, water technology sector, and water infrastructure sector. Water utility companies are responsible for the distribution and management of clean water and the treatment of wastewater. They supply and distribute water to residential, commercial and industrial customers. Water technology companies provide equipment and technologies for water treatment and management, while water infrastructure companies are involved in the construction and maintenance of water-related infrastructure such as dams, reservoirs, and water treatment facilities.
The water industry is also a highly regulated sector, with government agencies and international organizations playing a key role in setting standards and policies related to water management. This regulatory environment can create both opportunities and challenges for companies operating in the industry.
Factors To Consider Before Investing In Water Stocks
Investors must be aware that the government and other regulatory bodies regulate most of the water companies. Therefore, water stocks are subject to high volatility depending on the new rules and regulations surrounding the industry.
At the same time, investors must also consider the overall strength and fundamentals of the company before investing in water stocks. Such fundamentals include annual revenues, geographical diversity, competitive advantages, and contracts with government bodies.
Investors must also consider whether they want to invest in stocks of regulated or non-regulated water companies, as both have their pros and cons. The other factors to be considered include the dividend yield of water stocks and whether they are undervalued or overvalued.
Which Water Stocks Should I Buy?
A vast majority of water stocks trade on the stock exchanges. They belong to different water utility companies in the sector, with varying regulatory impacts, long-term gains, and short-term returns. Among the topwater stocks, we have aggregated a list of the best water stocks for you to pick from.
Water stocks are generally stable and long-term investments. They belong to stable and established companies that hold strong potential to generate long-term capital gains, in addition to regular dividend payments for investors.