Insider Trading Report: American Water Works Company (AWK)

Waterworks

Michael Marberry, a director at American Water Works Company (AWK), recently bought 825 shares. The buy increased his holdings by 200 percent, and came to a total cost of $120,541.

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  • This marks the first insider buy at American Water Works over the past two years. Otherwise, a few company executives have been sellers of shares, largely after exercising stock options with the firm.

    Overall, insiders own 0.2 percent of shares.

    The regulated water utility is down about 4 percent in the past year, about on par with the overall stock market. Operationally, AWK has performed better, with revenues rising by 11 percent and earnings rising by 8 percent. Plus, the utility sports a healthy 21 percent profit margin.

    Action to take: Shares are a little pricey here at 31 times forward earnings. And the yield is 1.9 percent, a bit low for a utility. But it’s been a great dividend grower over time, so investors may want to watch for a pullback under $140 before building a stake in this utility company.

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  • For traders, shares have been rangebound in the past year and appear to be heading lower in the coming months. The September $130 puts, last carrying a bid/ask spread of about $2.60, offer mid-double-digit returns at best on a further drop lower in shares.

     

    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.