Is Essential Utilities, Inc. overvalued or undervalued?

Jun 25 2025 08:09 AM IST
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As of May 12, 2025, Essential Utilities, Inc. is considered overvalued with a valuation grade shift from fair to expensive, indicated by a P/E ratio of 17, an EV to EBITDA of 14.79, and a lagging one-year return of 2.10% compared to the S&P 500's 10.26%.
As of 12 May 2025, the valuation grade for Essential Utilities, Inc. has moved from fair to expensive, indicating a shift in perception regarding its market value. The company appears to be overvalued at this time. Key ratios include a P/E ratio of 17, an EV to EBITDA of 14.79, and a PEG ratio of 2.67, which suggest that the stock is trading at a premium compared to its earnings growth potential.

In comparison to peers, Essential Utilities, Inc. has a P/E ratio of 17.17 and an EV to EBITDA of 14.65, which are slightly higher than its own metrics, reinforcing the notion of overvaluation. The company's return over the past year stands at 2.10%, significantly lagging behind the S&P 500's return of 10.26%, further emphasizing the potential disconnect between its current valuation and performance.
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