Forensic Analysis · Water Utilities · as of Nov 8, 2026
American Water Works Company, Inc. (AWK)
A forensic read on American Water Works Company, Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
B · Sound & dependable
Forensic grade
Clean
Earnings quality
2
Forensic signals
10.5%
ROE
9.7%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
American Water Works Company, Inc. earns a B (Sound & dependable) forensic quality grade. 2 forensic signals were flagged in its latest SEC filings, led by shareholder returns.
What the filings flag
FCF ($1.1B)
FY2025
Shareholder returns.Returned $633M to shareholders (buybacks + dividends) in FY2025, but free cash flow was ($1.1B) after capex — there was no free cash flow to fund the payout from at all, though operating cash flow alone was $2.1B — 31% of that. Capex and the payout together ran $1.7B past operating cash flow — a harder case than returns merely running ahead of free cash flow, since here there was none to run ahead of. New debt covered part of it: total debt rose $968M over FY2025, while cash rose $2M — $966M of the $1.7B. The FY2025 cash-flow statement filed $1.8B of debt issued against $664M repaid; $46M of investments purchased; net cash used in investing activities of $3.3B; net cash provided by financing activities of $1.2B.
4.7%
FY2025
Return on invested capital.Return on invested capital is 4.7% in the latest fiscal year and steady across FY2023–FY2025, inside a 0.4-point range. After-tax operating profit was $1.2B in FY2023 and $1.5B in FY2025, with operating income at 35.5% of revenue in FY2023, 36.7% in FY2024 and 36.6% in FY2025. The capital base behind it grew +12% across FY2023–FY2025, from $28.0B to $31.3B, and the return did not fall doing it, so the dollars added over that window earned at least the 4.2% the older base was already earning.
Key fundamentals
Latest Revenue$5.14B
Revenue Growth YoY+9.7%
Revenue CAGR (2yr)+10.2%
Net Margin21.6%
Free Cash Flow-$1.07B
Return on Equity10.5%
Debt / Equity1.33x
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