Kentucky American Water wins approval for higher base rates
Kentucky American Water received approval from the Kentucky Public Service Commission for new base water rates, resulting in an annualized revenue increase of $18.2 million. This is due to over $212 million in capital investments in water treatment and distribution. The rate adjustment will raise the average monthly residential bill by about $2, supporting infrastructure upgrades and service reliability. The company's stock, American Water (AWK), is rated as a Sell with a $122 price target, reflecting stable financial performance but weak technical indicators.
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An announcement from American Water ( (AWK) ) is now available.
On December 16, 2025, the Kentucky Public Service Commission approved new base water rates for Kentucky American Water, granting an annualized revenue increase of about $18.2 million, driven primarily by more than $212 million in water treatment and distribution system capital investments made since the company’s last rate filing, and setting an authorized return on equity of 9.70% on a $667 million rate base. The decision folds the costs and investments from the terminated Qualified Infrastructure Program rider into base rates and will raise the average monthly residential bill for customers using 3,900 gallons by roughly $2, while the company highlights that the rate adjustment supports ongoing infrastructure upgrades, regulatory compliance and service reliability, alongside existing customer assistance programs for payment flexibility and aid to income-eligible households.
The most recent analyst rating on (AWK) stock is a Sell with a $122.00 price target. To see the full list of analyst forecasts on American Water stock, see the AWK Stock Forecast page.
Spark’s Take on AWK Stock
According to Spark, TipRanks’ AI Analyst, AWK is a Neutral.
American Water’s overall stock score reflects a mix of stable financial performance and positive corporate events, offset by weak technical indicators and a high valuation. The merger with Essential Utilities is a key positive factor, expected to drive future growth and operational efficiency. However, the bearish technical signals and high P/E ratio suggest caution in the short term.
To see Spark’s full report on AWK stock, click here.
More about American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility in the United States, providing safe, clean, reliable and affordable drinking water and wastewater services to more than 14 million people across 14 states and 18 military installations, while its subsidiary Kentucky American Water is the largest regulated water utility in Kentucky, serving approximately 527,000 people in portions of 13 counties with a workforce of 150 employees.
Average Trading Volume: 1,846,602
Technical Sentiment Signal: Sell
Current Market Cap: $25.9B
See more data about AWK stock on TipRanks’ Stock Analysis page.
