Is California Water Service Group overvalued or undervalued?

As of 17 October 2025, the valuation grade for California Water Service Group has moved from very expensive to expensive, indicating a slight improvement in its valuation outlook. However, the company remains overvalued based on its current metrics. The P/E ratio stands at 20, while the industry average is not provided, suggesting a relative premium. Additionally, the EV to EBITDA ratio is 12.46, and the Price to Book Value is 1.67, both of which further support the overvaluation assessment.
In comparison to its peers, Essential Utilities, Inc. has a P/E of 16.89 and an EV to EBITDA of 14.36, while American States Water Co. shows a P/E of 22.76 and an EV to EBITDA of 15.88. These ratios highlight that California Water Service Group is priced higher than some of its peers, reinforcing the overvaluation conclusion. Notably, the company's stock has underperformed against the S&P 500 over the longer term, with a 1-year return of -9.58% compared to the S&P 500's 14.08%, which further emphasizes the challenges it faces in delivering value to shareholders.