Middlesex Water Co (MSEXP) stock analysis

P/E below its 5-year median

Middlesex Water's P/E of 20.8 is below its own 5-year median of 30.4.

P/E below the industry

Middlesex Water's P/E of 20.8 is below the Water Supply median of 22.5.

EV/EBITDA below its 5-year median

Middlesex Water's EV/EBITDA of 15.4 is below its 5-year median of 21.1.

P/B above the industry

Middlesex Water's price-to-book of 1.98 is above the Water Supply median of 1.86.

Trading below fair value

The share price of $57.64 is below our fair value estimate of $65.01.

Margin of safety under 20%

The price is 11.3% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 6.3% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -0.4% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 20.9% over the last twelve months, against a 5-year average of 2.2% a year.

Growing faster than the industry

Revenue grew 8.9% over the last twelve months; the Water Supply median is 5.9%.

Guidance issued

The latest outlook (2026 planned 2026 annual investment, Oct 29, 2026) was issued for the first time, so it neither adds nor takes away points.

Gross margin trend

This company does not report gross profit.

Return on equity under 15%

Return on equity was 10.1% over the last twelve months and averaged 9.7% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 6.5%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Middlesex Water's return on equity of 10.1% is above the Water Supply median of 9.0%.

Earnings grew over 5 years

Net income grew 2.2% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 24.5% over the last twelve months, against a 5-year average of 23.2%.

Net margin above the industry

Middlesex Water's net margin of 24.5% is above the Water Supply median of 20.4%.

High debt

Debt is 73.0% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 81.6% five years ago to 73.0%.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 17.4% of total debt; we look for at least 20%.

Interest not well covered

Operating income covers interest expense 4.3 times; we look for at least 5.

Short-term assets don't cover short-term debts

Current assets are 0.51 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.19; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Middlesex Water paid dividends worth 2.5% of the share price over the last twelve months.

Yield below Treasuries

The 2.5% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.9% or more; Middlesex Water yields 2.5%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 51.6% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.