The Q1 earnings miss is largely backward-looking and explained by the delayed GRC — the stock will trade on the GRC final decision expected April 30. If approved as proposed, the retroactive rate increase should add ~$0.38/share in catch-up EPS for Q1, transforming the reported loss into a beat. Monitor the CPUC vote; any material deviation from the revised PD would be negative. The Nexus acquisition adds long-term rate base growth but is subject to regulatory approvals.
Price Chart
Executive Summary
CWT reported Q1 2026 EPS of $0.07, a 68% decline from $0.22 in Q1 2025, and net income fell 70% to $4.0M. Revenue rose 5.2% to $214.6M, but operating expenses grew 8.1%, compressing margins. The critical event is the receipt of a revised Proposed Decision in the 2024 California GRC authorizing $90.5M in additional 2026 revenue (10.9% rate increase), with a final CPUC decision expected imminently, which will retroactively boost earnings from January 1, 2026.
Key Financial Metrics
Key Facts
- Q1 2026 EPS $0.07 vs $0.22 YoY, a 68% decline; net income $4.0M vs $13.3M YoY
- Q1 2026 revenue $214.6M, up 5.2% from $204.0M YoY, driven by rate changes and accrued unbilled revenue
- Operating expenses rose 8.1% to $196.4M, led by higher water production costs (+$8.3M) and depreciation (+$4.0M)
- Revised Proposed Decision in 2024 CA GRC authorizes $90.5M revenue increase in 2026 (10.9%), $43.2M in 2027, $48.9M in 2028
- Final CPUC decision expected April 30, 2026; rate increases retroactive to January 1, 2026
- Q1 2026 infrastructure investment $129.4M, up 17.5% YoY; full-year 2026 CapEx guided to $627M
- Agreement to acquire Nexus Water Group's Nevada and Oregon systems for ~$218M, adding ~36,000 customer equivalents
- Annual dividend increased 8% to $1.34/share, marking 59th consecutive annual increase
- S&P credit rating A+/stable; $370M available on bank lines of credit
Financial Impact
Q1 2026 EPS miss of $0.16 vs consensus ($0.07 actual vs $0.23 est) represents a ~70% shortfall; the GRC decision authorizes $90.5M in additional 2026 revenue, which would have added ~$0.38/share if recognized in Q1 (retroactive to Jan 1)
Risk Factors
- CPUC final decision could deviate materially from the revised PD, reducing authorized revenue increases
- Q1 2026 operating expense growth (8.1%) outpaced revenue growth (5.2%), pressuring margins even before GRC impact
- Short-term borrowings increased to $230M from $130M at year-end 2025, indicating higher working capital needs
- Nexus acquisition subject to regulatory approvals in Nevada and Oregon; integration risks
- California snowpack at 19% of normal could impact water supply and consumption patterns
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001104659-26-051949 |
| Document: tm2613168d1_ex99-2.htm | 0001104659-26-051949 |
| Document: tm2613168d1_8k.htm | 0001104659-26-051949 |
| Document: 0001104659-26-051949-index-headers.html | 0001104659-26-051949 |
| Document: 0001104659-26-051949-index.html | 0001104659-26-051949 |
| Document: 0001104659-26-051949.txt | 0001104659-26-051949 |
| 8-K Data (Synthetic) | 0001104659-26-051949 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Jul 30, 2026 9w ago | Press Release | $50.50 $50.09 | ▼ −0.81% | ▼ −4.78% | $45.86 (−9.19%) |
Jun 16, 2026 15w ago | Court Ruling | $45.45 $50.01 | ▲ +10.03% | ▲ +9.83% | $45.86 (+0.90%) |
May 27, 2026 18w ago | Insider Cluster | $43.82 $49.08 | ▲ +12.00% | ▲ +15.15% | $45.86 (+4.66%) |
May 20, 2026 19w ago | 8-K | $43.21 $45.29 | ▲ +4.81% | ▲ +4.48% | $45.86 (+6.13%) |
May 1, 2026 21w ago | 424B5 | $42.72 $43.86 | ▲ +2.67% | ▼ −2.97% | $45.86 (+7.35%) |
May 1, 2026 22w ago | 8-K | $42.03 $43.86 | ▲ +4.35% | ▼ −0.94% | $45.86 (+9.10%) |
Apr 30, 2026 22w ago | 8-K | $41.91 $45.10 | ▲ +7.60% | ▲ +2.37% | $45.86 (+9.41%) |
Apr 30, 2026 22w ago | Press Release | $41.91 $45.10 | ▲ +7.60% | ▲ +2.37% | $45.86 (+9.41%) |
Mar 20, 2026 28w ago | Insider Cluster | $43.57 $46.85 | ▲ +7.52% | ▼ −1.79% | $45.86 (+5.25%) |
Mar 18, 2026 28w ago | 8-K | $42.94 $44.81 | ▲ +4.36% | ▼ −1.68% | $45.86 (+6.81%) |
US Market Status
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