American Water Works
AWK
announced that its unit, Illinois American Water, is going to invest $2.7 million in Pontiac Water System to replace 3,300 feet of water main and rehabilitate six water filters at the water treatment plant.
The company will replace the existing 2-, 4- and 6-inch water mains with 8-inch water main. These replacements and upgrades will increase the reliability of its services and ensure the continuation of high-quality water service over the long run.
Illinois American Water provides water and wastewater services to nearly 1.3 million people as well as invests in the range of $70-$125 million annually in water and wastewater improvements across the state to address the aging infrastructure.
Investment in Aging Water Infrastructure
Potable water supply and wastewater services on a 24×7 basis are essential for maintaining hygiene and performing daily chores. Millions of miles of pipelines, storage tanks, pumps, desalination plants, filters and water refineries work in tandem to deliver clean as well as potable water for meeting daily requirements.
Per the findings of the American Society of Civil Engineers, water main breaks occur every two minutes in the United States due to aging of the existing water infrastructure. Pipeline breaks result in the wastage of 6 billion gallons of potable water each day and add to the loss of water utility operators. Per the Water and Wastewater Equipment Manufacturers Association, an estimated $750 billion investment is necessary to maintain and expand drinking water as well as wastewater services to meet demand over the next 20 years.
Water utilities operating in the United States are trying their best to upgrade and maintain the aging waster infrastructure. American Water continues to make investments in its infrastructure to upgrade, enhance and maintain the same. The company has plans to invest $10.4 billion in the 2021-2025 time period and $22-$25 billion in the next decade.
In addition to American Water Works, water utilities like
Essential Utilities
WTRG
are also making regular investments to upgrade the existing water and wastewater systems. Its long-term plan is to invest nearly $3 billion through 2023 to rehabilitate, and strengthen water as well as natural gas pipeline systems. Another water utility,
Global Water Resources
GWRS
is making acquisitions and the necessary investments to expand as well as strengthen operations, and upgrade the acquired assets for providing efficient services to customers.
California Water Service
CWT
plans to invest in the range of $270-$300 million in 2021 to strengthen its water and wastewater infrastructure.
Price Performance
Shares of American Water have outperformed the
industry
in the past year.
Zacks Rank
American Water currently has a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
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