York Water: 200 Years Of Uninterrupted Dividend Payments, But Limited Expected Returns Ahead

Seeking AlphaDividend Ideas | Utilities York Water: 200 Years Of Uninterrupted Dividend Payments, But Limited Expected Returns AheadSep. 30, 2020 12:00 PM ET|| About: The York Water Company (YORW), Includes: AWR, CWTby: Nikolaos SismanisNikolaos Sismanis Wheel of FortuneOne-Stop Shop For Ideas & Portfolios, Covering All Asset-Classes & SectorsSummaryThe York Water Company is the oldest investor-owned water utility in the United States, boasting 200 years of uninterrupted dividend payments to shareholders.
The company's dividends remain extremely secure, featuring a very low payout ratio. However, the stock's "safe-haven" status has caused investors to send its valuation higher over time.
Currently, at an all-time low yield of just 1.64%, and insufficient expected growth, investors face a limited medium-term return potential.
The York Water Company (YORW) is a special one since it is the oldest investor-owned water utility in the United States, having functioned continuously since 1816. The company owns a unique record, boasting 200 years of uninterrupted dividend payments to shareholders. The company's consistent performance throughout the centuries has been assisted by the stable and reliable cash flows derived from proving water.
We have previously covered some of the company's peers, including the California Water Service Group (CWT), and America's longest dividend aristocrat, American States Water (AWR). In those articles, we had praised their recession-proof cash flows and overall safety. However, we concluded that shares were overall too expensive.
In this article, we want to assess whether York Water offers a more investable opportunity, with more fruitful expected returns on the way. Source: Google Finance
More specifically, in this article, we will:
Discuss York Water's business model and financials Assess the stock's valuation, dividend growth, and expected returns, Conclude why shares may fit some... Read more