CAMDEN, N.J. - American Water (NYSE: NYSE:AWK), the nation's largest regulated water and wastewater utility, has begun the process of reactivating its systems following a cybersecurity incident reported on October 7. The company has stated that its water and wastewater operations were not compromised and that the quality of water remains unaffected.
The utility's customer portal, MyWater, is back online, and billing procedures have resumed with an assurance that customers will not incur late fees due to the temporary service disruption. This move comes after comprehensive security checks by both internal and external cybersecurity teams, adhering to the company's established cyber incident response protocols.
While the investigation into the specific details of the cybersecurity incident is still underway, involving a team of experts and law enforcement, American Water has committed to providing updates as new information becomes available. The company emphasizes that safeguarding its systems and customer data is of the utmost importance and has taken additional measures to enhance its cybersecurity infrastructure.
American Water, with a history dating back to 1886, serves over 14 million people across 14 states and on 18 military installations. The company employs approximately 6,500 professionals nationwide.
Customers seeking the latest information regarding the cyber incident can visit American Water's website. The company has expressed regret for any inconvenience caused by the incident and appreciates customer patience during the system restoration period.
This news is based on a press release statement from American Water.
In other recent news, American Water has been a focal point in several significant developments. The company recently detected a cybersecurity breach, leading to the temporary suspension of its billing processes and customer service operations. In response, American Water disconnected several computer systems as a precautionary measure, highlighting the growing need for robust cybersecurity measures in critical infrastructure sectors.
The company has also been the subject of analyst coverage, with Jefferies initiating a rating of Underperform due to concerns over the company's earnings per share growth and balance sheet pressures. The firm identified several challenges facing American Water, including difficulties in offsetting approximately $80 million in interest income post-2026 and increasing regulatory uncertainties.
Moreover, American Water's acquisition of Butler Area Sewer Authority's wastewater assets has received approval from the Pennsylvania Commonwealth Court, advancing a $230 million deal. Despite potential legal challenges, the company is proceeding to finalize the transaction.
Regarding earnings, American Water reported a strong performance in the first half of 2024, raising its earnings per share guidance for the year to $5.25-$5.30. The company also reached settlements in Virginia and New Jersey, resulting in annual revenue increases of $14.6 million and $79.5 million respectively. These are just a few of the recent developments for American Water.
InvestingPro Insights
As American Water (NYSE: AWK) navigates the aftermath of its recent cybersecurity incident, investors may find valuable context in the company's financial metrics and market performance. According to InvestingPro data, American Water boasts a market capitalization of $26.54 billion, underscoring its position as a major player in the utility sector.
The company's resilience is reflected in its consistent dividend history. An InvestingPro Tip highlights that American Water has raised its dividend for 10 consecutive years, demonstrating a commitment to shareholder returns even in challenging times. This track record of dividend growth, coupled with a current dividend yield of 2.25%, may provide some reassurance to investors concerned about the recent cybersecurity event.
From a profitability standpoint, American Water appears to be on solid ground. The company's gross profit margin stands at a robust 59.83% for the last twelve months as of Q2 2024, indicating strong operational efficiency. This financial health could be crucial as the company invests in strengthening its cybersecurity measures following the recent incident.
It's worth noting that American Water trades at a P/E ratio of 27.86, which an InvestingPro Tip suggests is high relative to its near-term earnings growth. This valuation metric might warrant attention from investors assessing the company's future prospects in light of recent events.
For those interested in a deeper dive into American Water's financial health and market position, InvestingPro offers 8 additional tips, providing a more comprehensive analysis of the company's strengths and potential challenges.
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