10 Most Profitable Utility Stocks to Buy Now

8. American Water Works Company, Inc. (NYSE:AWK)

Net Profit Margin: 22.44%

American Water Works Company, Inc. (NYSE:AWK), which serves almost 3.5 million customers across 16 states, is the biggest investor-owned water and wastewater utility in the United States. The firm mostly works in regulated markets and offers water and wastewater services to residential, commercial, and industrial clients. Water services for military sites, which are provided under long-term contracts with regulated-like returns, are the company’s unregulated business. The stock surged by more than 16% YTD, and its net profit margin growth is 22.44%, making it among the Best Utility Stocks.

American Water Works Company, Inc. (NYSE:AWK)’s earnings growth has consistently outpaced that of most regulated electric utilities, despite the fact that core retail water demand has constantly declined due to efficiency savings.

The business effectively carried out its plan in 2024, investing over $3 billion in infrastructure, and produced 2024 earnings of $5.39 per share, indicating an 8% YoY growth. The business added around 70,000 new client connections, hitting its acquisition goal. As of early 2025, it had over 24,000 customer connections under contract. American Water Works Company, Inc. (NYSE:AWK) maintained its earnings guidance for 2025 at $5.65 to $5.75 per share, which is an 8% YoY increase above weather-normalized 2024 EPS.

Angie Storozynski, a Seaport Research analyst, maintained a Buy recommendation on its shares and increased the price objective from $140 to $156. According to the analyst, American Water Works Company, Inc. (NYSE:AWK) continues to have a good outlook on the water utilities industry and is attracted to American Water because of its defensive qualities.