Company: AWK
Filing Date: 2025-12-17
Form Type: S-4
Source: 0001193125-25-321389
Chunk: 126

Company: American Water Works Company, Inc.
Filing Date: 2025-12-17
Form: S-4
Chunk 126
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, respectively, and with a median of 19.1x and 17.1x, respectively). BofA Securities noted that the 2026E P/E multiples and 2027E P/E multiples observed for Essential were 18.8x and 17.3x, respectively, based on the closing price per share of Essential common stock on October 22, 2025. Based on BofA Securities’ review of the 2026E P/E multiples and 2027E P/E multiples observed for the selected publicly traded companies and on its professional judgment and experience, BofA Securities calculated ranges of implied equity value per share reference ranges for Essential by applying (i) a 2026E P/E multiple reference range of 19.25x to 21.75x to the estimate of Essential’s calendar year 2026 recurring EPS and (ii) a 2027 P/E multiple reference range of 17.25x to 19.50x to the estimate of Essential’s calendar year 2027 recurring EPS, each as reflected in the Essential forecasts. Additionally, BofA Securities performed a sum-of-the-partsselected publicly traded companies analysis for Essential by separately deriving approximate implied equity value per share reference ranges for Essential’s water utility segment and Essential’s gas local distribution segment. Based on BofA Securities’ review of 2026E P/E multiples and 2027E P/E multiples observed for the water utility companies and gas local distribution companies, and on its professional judgement and experience, BofA Securities calculated implied equity value per share reference ranges (i) for Essential’s water utility segment by applying a 2026E P/E multiple reference range of 19.50x to 23.25x to the estimate of Essential’s calendar year 2026 water utility segment-level recurring EPS (including illustrative allocated estimated corporate expenses) and (ii) for Essential’s gas local distribution segment by applying a 2026E P/E multiple reference range of 18.0x to 22.25x to the estimate of Essential’s calendar year 2026 gas local distribution segment-level recurring EPS (including illustrative allocated estimated corporate expenses), each as reflected in the Essential forecasts. BofA Securities then calculated an implied equity value per share reference range for Essential based on the combined range of such implied equity values. 83

This analysis indicated the following approximate implied equity value reference ranges per share of Essential common stock (rounded to the nearest $0.05), as