AWK vs AWR: How American Water Works and American States Water Company Compare (2026)

Last updated July 2026

Short answer

AWK is the larger of the two ($25.52B market cap): the incumbent the market prices for continued execution (19.93x forward earnings, beta 0.60). AWR is the smaller challenger ($3.31B), priced similarly on forward earnings (22.30x): more room to run, but more to prove. The real question is which set of drivers you believe, and whether owning one (or both) leaves you over-concentrated.

AWK vs AWR: the tie-breaker metrics

Same yardstick, side by side (as of July 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.

Metric	AWK	AWR	What it tells you
Market cap	$25.52B	$3.31B	Size. The larger name is the incumbent; the smaller has more room to grow and more to prove.
Forward P/E	19.93	22.30	Valuation on next year's expected earnings, the same yardstick for both. Lower is cheaper for that growth; higher means the market is paying up.
Trailing P/E	23.13	24.64	Valuation on the last 12 months. A big drop from trailing to forward means the market expects earnings to jump, so more growth is already in the price.
Beta	0.60	0.58	Volatility vs the market. Above 1 swings harder than the index; below 1 is steadier. Higher beta means bigger drawdowns to hold through.
Price vs 52-week range	37% of range	93% of range	Where today's price sits between the 52-week low and high. Near the high is momentum with less margin of safety; near the low is out of favor or a discount, depending on why.
Price / book	2.31	3.11	How much you pay over book value. Very high can signal an asset-light, high-return business or a rich price.

Before you buy: how AWK and AWR affect your concentration

The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. AWK and AWR share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.

This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined AWK and AWR exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.

What does American Water Works (AWK) do?

American Water Works is the largest publicly traded, regulated water and wastewater utility in the United States, serving roughly 14 million people through regulated operations in 14 states plus 18 military installations. Its business model is classic rate-base utility economics: the company invests heavily in pipes, treatment plants, and water systems, then earns an allowed regulated return on that invested capital once state utility commissions approve rate cases. Growth comes from two levers, ongoing infrastructure spending and acquisitions of small municipal and investor-owned water systems that fold into its existing footprint.

Full AWK guide

What does American States Water Company (AWR) do?

American States Water Company is a Southern California based utility holding company with three businesses. Its largest is Golden State Water Company, a regulated water utility serving roughly 265,000 connections across more than 80 California communities, which contributes the bulk of revenue. Bear Valley Electric Service distributes electricity to about 24,900 connections in the Big Bear Lake area, and American States Utility Services (ASUS) runs water and wastewater systems on a dozen-plus U.S. military bases under long-term (often 50-year) privatization contracts with the federal government.

Full AWR guide

AWK vs AWR: how do they differ?

Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.

AWK drivers: Rate-base growth and capital investment; Acquisitions of municipal and small water systems.
AWR drivers: Rate-base growth under CPUC decisions; Long dividend-growth streak.

Which fits which kind of investor

A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: The biggest risk is regulatory: earnings depend on state utility commissions approving rate cases at constructive returns, and regulatory lag (the gap between when capital is spent and when rates are allowed to recover it) can pressure results. For AWR, aWR is heavily concentrated in California, so its results hinge on CPUC decisions covering allowed returns, cost of capital, and rate-case timing, any of which can pressure earnings if unfavorable.

AWK or AWR: which should you pick?

Growth-minded investors who believe the theme has years to run tend to accept the richer multiple for more upside; value-minded investors lean toward the cheaper forward earnings and steadier profile. Pick AWK if you believe its drivers more; AWR if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the AWK and AWR guides.

AWK vs AWR: the full fundamentals

AWK. AWK typically trades at a premium P/E to the broader market, reflecting its regulated, low-volatility earnings and long runway of rate-base growth. In the first quarter of 2026 revenue rose year over year to about $1.21 billion while adjusted EPS was roughly $1.01 (versus about $1.02 a year earlier), and management reaffirmed full-year 2026 EPS guidance of about $6.02 to $6.12. The dividend yields roughly 2.5-2.8%, modest in absolute terms but growing near the top of the utility peer group.

AWR. AWR trades at a premium valuation that is common for high-quality regulated water utilities, reflecting its long dividend record and predictable rate-base earnings rather than fast growth. FY2025 revenue rose about 10% on new rates and contract activity, and Q1 2026 EPS grew on CPUC-authorized rate increases. The modest yield means the return case leans on steady dividend growth above 7% and a stable multiple.

Headline figures (approximate, JULY 2026): AWK shows market cap ~$26 billion, share price ~$135, q1 2026 revenue ~$1.21 billion, q1 2026 adjusted eps ~$1.01; AWR shows revenue (fy2025) ~$658 million, diluted eps (fy2025) ~$3.37, q1 2026 eps ~$0.76 (up from ~$0.70), p/e ratio ~24x (forward ~20x).

The bottom line: AWK vs AWR

AWK and AWR are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined AWK and AWR exposure against your real portfolio. It is not an investment adviser.

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FAQ

What is the difference between AWK and AWR?

American Water Works is the largest publicly traded, regulated water and wastewater utility in the United States, serving roughly 14 million people through regulated operations in 14 states plus 18 military installations. American States Water Company is a Southern California based utility holding company with three businesses. They show up together because they share investment themes, but they are different businesses, so the better fit depends on which thesis you are expressing.

Is AWK or AWR the better stock?

Neither is universally better. AWK is the larger incumbent; AWR is the smaller challenger and looks pricier on forward earnings. Walnut is informational, not investment advice. Compare what each does, the tie-breaker metrics above, and the risks, then decide which fits your thesis and what you already own.

Which is cheaper, AWK or AWR?

On forward P/E (as of July 2026), AWK trades at 19.93x and AWR at 22.30x, so AWK is the cheaper of the two on next year's expected earnings. A lower multiple is not automatically the better buy: a richer valuation can be justified by faster growth, and a lower one can reflect real risk. Weigh the multiple against how fast each business is compounding.

Should you own both AWK and AWR?

Because they share themes, owning both concentrates you in that theme. That can be intentional (a focused bet) or accidental (less diversification than it looks). Walnut can show your combined exposure across both, and whether adding either over-concentrates you, before you buy.

What are the risks of AWK vs AWR?

AWK: The biggest risk is regulatory: earnings depend on state utility commissions approving rate cases at constructive returns, and regulatory lag (the gap between when capital is spent and when rates are allowed to recover it) can pressure results. As a capital-intensive utility carrying substantial debt, AWK is sensitive to interest rates, which raise financing costs and can compress the valuation multiple. The pending Essential Utilities merger adds integration and approval risk, and could be delayed or altered by remaining regulators. Weather, drought, and water-quality or environmental compliance costs can also affect a given period. Finally, the stock often trades at a premium valuation, so disappointing rate outcomes or higher-for-longer rates can weigh on the shares. AWR: AWR is heavily concentrated in California, so its results hinge on CPUC decisions covering allowed returns, cost of capital, and rate-case timing, any of which can pressure earnings if unfavorable. Drought, water-supply costs, and wildfire or infrastructure liabilities are ongoing regional exposures. The stock typically trades at a premium price-to-earnings multiple relative to the broader market and even some utility peers, which leaves less margin for error if growth disappoints. Rising interest rates can weigh on utility valuations and raise financing costs for a capital-intensive business. The dividend yield is modest, so a large portion of the return case depends on continued dividend growth and multiple stability rather than current income.

Walnut is informational, not investment advice. This page is descriptive and not a recommendation to buy or sell AWK or AWR; figures are approximate and dated (as of July 2026). Verify current data before investing.