California Water Service Group (CWT) shares have shown steady movement in recent weeks, prompting investors to reevaluate the stock’s trajectory. Over the past month, the stock has gained more than 7%, which has caught the attention of those following utility sector trends.
See our latest analysis for California Water Service Group.
California Water Service Group’s share price has bounced back recently, yet the longer-term picture suggests momentum remains mixed. While investors have enjoyed an 8% share price gain year-to-date and a strong 7% return over the past month, the one-year total shareholder return still reflects a 7% decline. This underscores the challenges faced by utilities during this period of shifting interest rates and regulatory pressures.
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With shares still trading around 14% below the average analyst price target and long-term returns remaining uneven, the question becomes whether California Water Service Group is undervalued at current levels or if the market has already factored future growth into the price.
California Water Service Group’s most watched narrative points to a fair value of $55.50, which is notably above the last close of $48.54. The narrative frames recent price action as a potential opportunity and sets the stage for a deeper look at the fundamental drivers behind the share price.
Accelerating capital investment in water infrastructure and modernization, driven by increasing water scarcity, climate adaptation needs, and urban population growth, positions Cal Water to expand its regulated rate base by a projected ~12% CAGR. This supports sustained long-term revenue and cash flow growth.
Curious what powers this bullish outlook? The fair value calculation leans heavily on an ambitious runway for revenue, margins, and earnings. The secret to this premium? The narrative is built on projections normally reserved for the hottest sectors. Find out what numbers make analysts this optimistic.
Result: Fair Value of $55.50 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, ongoing regulatory delays and rising compliance costs could limit the company’s anticipated earnings growth, which may challenge the bullish narrative.
Find out about the key risks to this California Water Service Group narrative.
Looking through a different lens, California Water Service Group is valued at 21.3 times earnings, higher than both the global water utilities industry average of 16.9 and its peer average of 20.7. The fair ratio, or where the market might settle, stands at 19.5. This leaves shares looking relatively expensive by this method. Should investors worry, or does this premium reflect genuine long-term potential?
See what the numbers say about this price — find out in our valuation breakdown.
NYSE:CWT PE Ratio as at Oct 2025
If you think there’s a different angle or want to dig into the numbers yourself, you can easily shape your own view in just a few minutes. Do it your way.
A great starting point for your California Water Service Group research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include CWT.
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