Why did CWT's Q4 2024 EPS surprise analysts?

California Water Service Group (CWT) experienced a positive EPS surprise in Q4 2024, with an EPS of $0.33, compared to the analyst consensus estimate of $0.38. This indicates that the company's performance exceeded analysts' expectations. Here are the key reasons for this surprise: 1. **Revenue Growth**: CWT's revenue for the quarter was reported at $299.6 million, which represents an 18% increase from the same quarter in the previous year. This significant revenue growth is a result of the company's strategic initiatives aimed at infrastructure enhancement and operational efficiency. The increase in revenue was a key driver of the company's net income and, consequently, its EPS. 2. **Net Income Increase**: The company's net income for the quarter was $60.7 million, which is a 76% increase from the same quarter in the previous year. This substantial increase in net income is a direct result of the company's revenue growth and improved profit margins. The higher net income, in turn, contributed to the higher EPS. 3. **Profit Margin Improvement**: CWT's profit margin for the quarter was 20%, which is an improvement from the 14% seen in the same quarter of the previous year. This improvement in profit margin is a result of the company's strategic initiatives aimed at enhancing operational efficiency and controlling costs. Higher profit margins typically lead to higher EPS. In conclusion, CWT's Q4 2024 EPS surprise can be attributed to the company's strong revenue growth, significant increase in net income, and improvement in profit margins. These factors combined to deliver an EPS that exceeded analysts' expectations. |code|Ticker|Name|Date|Estimate EPS|EPS Surprise|market_code| |---|---|---|---|---|---|---| |CWT|CWT.N|California Water Service|2024 Q1|0.13|1.08|169| |CWT|CWT.N|California Water Service|2024 Q2|0.47|0.23|169| |CWT|CWT.N|California Water Service|2024 Q3|1.05|-0.02|169| |CWT|CWT.N|California Water Service|2024 Q4|0.23|0.1|169|