Contrasting AquaVenture (WAAS) and Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp (SBS)

AquaVenture (NYSE: WAAS) and Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp (NYSE:SBS) are both utilities companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, risk, earnings, institutional ownership, analyst recommendations and valuation.

Dividends

Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp pays an annual dividend of $0.29 per share and has a dividend yield of 2.8%. AquaVenture does not pay a dividend. Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp pays out 22.3% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares AquaVenture and Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AquaVenture $114.10 million 3.57 -$20.47 million ($1.01) -15.23
Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp $4.07 billion 1.72 $844.93 million $1.30 7.88

Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp has higher revenue and earnings than AquaVenture. AquaVenture is trading at a lower price-to-earnings ratio than Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

AquaVenture has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500. Comparatively, Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp has a beta of 1.85, indicating that its stock price is 85% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for AquaVenture and Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AquaVenture 0 0 4 1 3.20
Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp 1 2 3 0 2.33

AquaVenture presently has a consensus price target of $22.00, suggesting a potential upside of 43.04%. Given AquaVenture’s stronger consensus rating and higher possible upside, equities analysts plainly believe AquaVenture is more favorable than Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp.

Profitability

This table compares AquaVenture and Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AquaVenture -22.56% -7.38% -5.01%
Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp 19.70% 17.82% 7.79%

Institutional & Insider Ownership

36.8% of AquaVenture shares are held by institutional investors. Comparatively, 16.0% of Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp shares are held by institutional investors. 55.9% of AquaVenture shares are held by company insiders. Comparatively, 1.0% of Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

About AquaVenture

AquaVenture Holdings Limited is a multinational provider of Water-as-a-Service solutions. The Company’s segments are Seven Seas Water and Quench. The Seven Seas Water segment provides outsourced desalination solutions and wastewater treatment for governmental, municipal, industrial and hospitality customers. The Quench segment provides bottleless filtered water coolers and other products that use filtered water as an input, such as ice machines, sparkling water dispensers and coffee brewers, to customers throughout the United States typically under multi-year contracts. The Company’s solutions utilize seawater reverse osmosis and other purification technologies to produce potable and industrial process water in high volumes for customers operating in regions with limited access to potable water. As of December 31, 2016, it operated 10 water treatment facilities in the Caribbean region and South America producing approximately eight billion gallons of purified water per year.

About Companhia de saneamento Basico Do Estado De Sao Paulo – Sabesp

Companhia de Saneamento Basico do Estado de Sao Paulo-SABESP is a water and sewage service provider. The Company provides water and sewage services to a range of residential, commercial, industrial and governmental customers in over 360 municipalities in the state of Sao Paulo, including the city of Sao Paulo. The Company’s segments include Water and Sewage. The Company also supplies treated water on a wholesale basis to approximately 10 municipalities located in the Sao Paulo metropolitan region and urban conurbations. The Company’s activities comprise water supply, sanitary sewage services, urban rainwater management and drainage services, urban cleaning services, solid waste management services and related activities, including the planning, operation, maintenance and commercialization of energy, and the commercialization of services, products, benefits and rights that directly or indirectly arise from its assets, operations and activities.

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