The Prudent Investor

A Quick Look at Connecticut Water Service
January 17, 2007, 8:32 am
Filed under: Water Utilities

The seventh company in our group is Connecticut Water Service (NASDAQ:CTWS), with a market capitalization of $188 Million.

Yahoo Finance offers the following description:

Connecticut Water Service, Inc., through its wholly owned subsidiaries, primarily supplies drinking water in Connecticut. It operates in three segments: Water Activities, Real Estate Transactions, and Services and Rentals. Water Activities segment supplies public drinking water. It also provides sewer operations and other water-related services. Real Estate Transactions segment involves in the sale of its excess real estate holdings. Services and Rentals segment provides contracted services to water and wastewater utilities, and other clients, as well as bulk delivery of emergency drinking water to businesses and residences via tanker truck. It also leases and rents residential and commercial properties to third parties.

To date I have examined six companies and have decided to retain six companies for further consideration. I finally come to a company that will be tossed from the list. I would go through the normal display of numbers, but one figure jumped out at me so forcefully that I decided that it was not necessary to look any further: Quarterly Revenue Growth of -5.3%. Whereas all of the other companies in the group are moving forward, this one is going in the wrong direction. This could be due to the real estate component, but the bottom line is that with so many other excellent opportunities, this one can be tossed from the list without looking into things further.


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