Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Five Water Stocks That Hedge Funds Like

Page 1 of 2

Given that water demand is somewhat inelastic and relatively insensitive to economic conditions, it’s not surprising that many smart money holders would own shares of water-related companies for their stability (and dividend yield).

On the account of that stability, we at Insider Monkey have put together a list of some of the most popular water-related stocks among the investors we track. In this article, let’s take a closer look at American Water Works Company Inc (NYSE:AWK), SJW Corp. (NYSE:SJW), Aqua America Inc (NYSE:WTR), Middlesex Water Company (NASDAQ:MSEX), and American States Water Co (NYSE:AWR).

At Insider Monkey, we track around 750 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).

#5 American States Water Co (NYSE:AWR)

– Number of Hedge Fund Holders (as of June 30): 8
– Total Value of Hedge Fund Holdings (as of June 30): $45.94 million
– Hedge Fund Holdings as Percent of Float (as of June 30): 2.90%

Although its annual dividend of $0.90 per share (2.32% yield at current prices) isn’t the highest payout in the industry, American States Water Co (NYSE:AWR)’s dividend is certainly among the safest. Due to the stable cash flow afforded through providing water to over 260,000 Californians, American States Water has paid a dividend every year since 1931 (and its dividend has grown every year for 61 straight years), placing the stock in very exclusive company. The company’s dividend has also increased in recent years, averaging a dividend growth CAGR of 11% since 2010. One reason for the growth is that American States Water has actively expanded by providing water services for ten military bases in seven states. The company is also actively bidding for more contracts with other bases. Billionaire Jim Simons’ Renaissance Technologies trimmed its stake in American States Water by 12% in the second quarter to 811,100 shares.

Follow American States Water Co (NYSE:AWR)
Trade (NYSE:AWR) Now!

#4 Middlesex Water Company (NASDAQ:MSEX)

– Number of Hedge Fund Holders (as of June 30): 9
– Total Value of Hedge Fund Holdings (as of June 30): $34.1 million
– Hedge Fund Holdings as Percent of Float (as of June 30): 4.80%

The smart money became more bullish on Middlesex Water Company (NASDAQ:MSEX) in the second quarter. Of the around 750 funds that we track, nine funds owned $34.1 million worth of Middlesex Water Company (NASDAQ:MSEX)’s stock, which accounted for 4.80% of the float on June 30, versus eight funds and $17.44 million, respectively, a quarter earlier. One reason for the enthusiasm is Middlesex’s quarterly dividend of $0.20 per share, which translates into a 2.4% yield. Although that doesn’t sound like much, the yield is still 50% higher than the 10-year Treasury yield of 1.675%.

Follow Middlesex Water Co (NASDAQ:MSEX)
Trade (NASDAQ:MSEX) Now!
Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!