Essential Utilities, Inc. (WTRG) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-216.6%

-$51.33

vs $44.02 price

Levered DCF

-$116.11

After debt service

Piotroski score

7 / 9

Strong

Altman Z-score

1.02

Distress zone

Rating

B+

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	17.44×	16.74×	20.08×	26.97×	31.96×	41.48×	45.13×	31.66×
P/B	1.57×	1.6×	1.69×	2.33×	2.67×	2.52×	2.61×	3.03×
P/S	4.34×	4.77×	4.86×	5.48×	7.36×	8.08×	11.37×	7.26×
EV / EBITDA	13.94×	14.18×	16.11×	19.18×	21.39×	24.68×	22.97×	20.37×
Gross margin	41.0%	58.6%	54.8%	46.9%	52.6%	52.5%	62.6%	63.2%
Operating margin	37.2%	36.3%	33.7%	28.9%	32.1%	29.7%	38.2%	38.6%
Net margin	24.9%	28.5%	24.3%	20.3%	23.0%	19.5%	25.2%	22.9%
Current ratio	0.8×	0.5×	0.62×	0.64×	0.65×	0.63×	6.23×	0.37×
Debt / equity	1.22×	1.25×	1.2×	1.27×	1.16×	1.22×	0.8×	1.27×
Interest coverage	2.8×	2.5×	2.44×	2.78×	2.9×	2.31×	2.71×	3.27×
Dividend yield	3.5%	3.5%	3.2%	2.3%	1.9%	2.0%	1.9%	2.5%
Payout ratio	60.6%	58.2%	63.6%	62.0%	59.9%	81.6%	84.0%	78.5%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	9.0%	9.6%	8.4%	8.7%	8.3%	6.1%	5.8%	9.6%
Return on invested capital	4.7%	4.4%	4.3%	4.4%	4.3%	3.3%	3.7%	4.8%
Return on assets	3.1%	3.3%	3.0%	3.0%	2.9%	2.1%	2.4%	2.8%
Free cash flow yield	-3.9%	-5.6%	-2.7%	-3.7%	-2.7%	-2.8%	-2.1%	-2.1%
Earnings yield	5.7%	6.0%	5.0%	3.7%	3.1%	2.4%	2.2%	3.2%
Enterprise value	$19B	$17.7B	$17.1B	$19.4B	$19.8B	$17.5B	$11.3B	$8.6B
Net debt / EBITDA	6.08×	6.2×	6.69×	6.76×	6.48×	8.05×	2.47×	6.02×
Cash conversion cycle (days)	16	-16	1	48	17	6	-18	-29