On Oct 24, SJW Corp. (SJW) was upgraded to a Zacks Rank #1 (Strong Buy) by Zacks Investment Research.Going by the Zacks model, companies holding a Zacks Rank #1 have strong chances of performing better than the broader market.
Why the Upgrade?
SJW Corp.’s wholly owned subsidiary, San Jose Water Company received the final decision from the California Public Utilities Commission (“CPUC”) for the much awaited 2013 general rate case. Under the final authorization, the company is expected to increase its revenue by approximately $22.1 million or 9.8% for 2013and $13.3 million or 5.2% for 2014.
The favorable decision will be reflected in the company’s financials in the quarters to come. An increase in revenues from rate cases will help to offset the adverse effects of high operation and maintenance expenses and reduced water usage by customers.
SJW Corp. holds a record of consistently sharing profit with its shareholders. The company’s dividend history reveals that it has without fail increased dividends year after year and currently has an impressive payout ratio of 54.0%. At present, the company has a dividend yield of 2.64%.
San Jose, CA based SJW Corp. is a water utility operating through its two segments, Water Utility Services and Real Estate Service.
Other Stocks to Consider
Apart from SJW Corp, other well-raked stocks in the utility space include American Water Works Company, Inc. (AWK), Consolidated Water Co. Ltd. (CWCO) and NRG Energy, Inc. (NRG). All these stocks currently sport a Zacks Rank #2 (Buy).
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