Pure Cycle (NASDAQ: PCYO) and Global Water Resources (NASDAQ:GWRS) are both small-cap utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, dividends, institutional ownership, analyst recommendations, earnings and profitability.
Valuation and Earnings
This table compares Pure Cycle and Global Water Resources’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Pure Cycle||$1.22 million||180.15||-$1.71 million||N/A||N/A|
|Global Water Resources||$31.21 million||5.63||$4.55 million||$0.12||74.58|
This table compares Pure Cycle and Global Water Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Global Water Resources||14.14%||14.91%||0.87%|
Risk and Volatility
Pure Cycle has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, Global Water Resources has a beta of -0.01, indicating that its stock price is 101% less volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for Pure Cycle and Global Water Resources, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Global Water Resources||0||0||1||0||3.00|
Global Water Resources has a consensus target price of $11.00, indicating a potential upside of 22.91%. Given Global Water Resources’ higher probable upside, analysts clearly believe Global Water Resources is more favorable than Pure Cycle.
Insider and Institutional Ownership
68.0% of Pure Cycle shares are owned by institutional investors. Comparatively, 19.0% of Global Water Resources shares are owned by institutional investors. 4.8% of Pure Cycle shares are owned by insiders. Comparatively, 49.2% of Global Water Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Global Water Resources pays an annual dividend of $0.28 per share and has a dividend yield of 3.1%. Pure Cycle does not pay a dividend. Global Water Resources pays out 233.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Global Water Resources beats Pure Cycle on 8 of the 12 factors compared between the two stocks.
Pure Cycle Company Profile
Pure Cycle Corporation is an integrated water company that provides wholesale water and wastewater services. The Company provides its services to wholesale customers, which include industrial customers and local governmental entities that provide water and wastewater services to their end-use customers located in the Denver, Colorado metropolitan area. The Company is engaged in selling water service to customers, using water rights owned or controlled by the Company and developing infrastructure to divert, treat and distribute that water and collect, treat and reuse wastewater. The Company owns a portfolio of water rights located in the Denver, Colorado metropolitan area, Southeastern Colorado in the Arkansas River, and the Western Slope of Colorado in the Colorado River. The Company’s Denver area assets include Rangeview Water, the Lowry Range Property, Sky Ranch and Arapahoe County Fairgrounds.
Global Water Resources Company Profile
Global Water Resources, Inc., a water resource management company, owns, operates, and manages regulated water, wastewater, and recycled water utilities primarily in metropolitan Phoenix, Arizona. As of December 31, 2017, it served approximately 51,000 people in approximately 20,000 homes. The company was founded in 2003 and is based in Phoenix, Arizona.
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