CWT
California Water Service Group
$48.04
Stable Earnings Power
85%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 39.7% above fair value
You pay
$48.04
Bear
$30.10
Fair
$34.40
Bull
$38.70
Bear
$30.10
-37.3%
$2.15 × 14x P/E
Fair
$34.40
-28.4%
$2.15 × 16x P/E
Bull
$38.70
-19.4%
$2.15 × 18x P/E
Adjust Assumptions
16.0x
2.15$
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
22.3x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$53.50
Divergence from AlphaVal
36%
Summary
Applying a 16x P/E to adjusted EPS of $2.15, the base-case value is $34.40 per share. DDM cross-check: $65.66.
Warnings
Dividend-based valuation: $65.66 (above our primary estimate by 91%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $53.50 (from 10 analysts). Our estimate is 36% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples