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Consolidated Water (CWCO) Exceeds Market Returns: Some Facts to Consider

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Consolidated Water (CWCO - Free Report) closed the most recent trading day at $24.65, moving +0.86% from the previous trading session. The stock outperformed the S&P 500, which registered a daily gain of 0.27%. Elsewhere, the Dow gained 0.65%, while the tech-heavy Nasdaq added 0.26%.

The developer and operator of desalination plants's stock has dropped by 2.9% in the past month, falling short of the Utilities sector's loss of 2.82% and the S&P 500's gain of 2%.

Analysts and investors alike will be keeping a close eye on the performance of Consolidated Water in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $0.26, marking a 52.73% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $31.77 million, reflecting a 36.27% fall from the equivalent quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $1.25 per share and a revenue of $137.5 million, representing changes of -35.23% and -23.7%, respectively, from the prior year.

Any recent changes to analyst estimates for Consolidated Water should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Currently, Consolidated Water is carrying a Zacks Rank of #4 (Sell).

In the context of valuation, Consolidated Water is at present trading with a Forward P/E ratio of 19.5. This denotes a discount relative to the industry's average Forward P/E of 20.55.

We can also see that CWCO currently has a PEG ratio of 2.44. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Utility - Water Supply industry held an average PEG ratio of 3.16.

The Utility - Water Supply industry is part of the Utilities sector. With its current Zacks Industry Rank of 86, this industry ranks in the top 35% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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