MeritValue

H2O AMERICA

HTOdata completeness 88%17 fiscal years on file

Data notes: no data for concept 'capex'

The thesis, from the filings

H2O AMERICA earns about 3% on invested capital, but has diluted owners by 18% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $25.09 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$559.6M1$586.9M2$678.2M3$736.3M3$805.6M3
Net income$60.5M4$73.8M5$85M6$94M6$102.6M6
Operating cash flow$130M7$166.2M8$190.8M9$195.5M9$244.8M9
Capital expenditure—————
Free cash flow (derived)—————
Total debt$3.05B10$2.99B11$3.16B12$3.43B13$3.79B13
Cash & equivalents$10.9M14$12.3M14$9.72M15$11.1M16$20.7M16
Diluted shares29.7M30.4M31.7M32.8M35.1M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$438.93
your share of equity
Profit it earned you last year
$29.22
Free cash flow it threw off
—
Debt you’d be carrying
$1,080.13

10 shares is a claim on $438.93 of net worth that earned you $29.22 last year, against $1,080.13 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
3% avg · 5y
FY21 3%FY22 3%FY23 3%FY24 3%FY25 3%

It earned an average 3% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+18% shares · 5y

Share count is up 18% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 24% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
DCF · Growth Exit 5Y
not applicable
only 0 years of FCF (need ≥3) — model not applicable
Earnings Power Value
$25.09
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$85M
  • growthAssumed0.0%
Graham Number
$53.7
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000766829-24-000023 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000766829-25-000009 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001628280-26-012438 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000766829-24-000023 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000766829-25-000009 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001628280-26-012438 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000766829-24-000023 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000766829-25-000009 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001628280-26-012438 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000766829-23-000041 (LongTermDebtNoncurrent)
  11. 10-K · period ending 2022-12-31 · accession 0000766829-24-000023 (LongTermDebtNoncurrent)
  12. 10-K · period ending 2023-12-31 · accession 0000766829-25-000009 (LongTermDebtNoncurrent)
  13. 10-K · period ending 2024-12-31 · accession 0001628280-26-012438 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2021-12-31 · accession 0000766829-24-000023 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2023-12-31 · accession 0000766829-25-000009 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2024-12-31 · accession 0001628280-26-012438 (CashAndCashEquivalentsAtCarryingValue)