danwagnerco

SJW is a long swing trade opportunity AND a buy-and-hold

Long
NYSE:SJW   SJW Group
SJW Group offers at least 10% upside in the $62 range as of Friday March 26, 2021 and, thanks to steady dividend growth, would make a fine addition to your "buy and hold" portfolio.

Weaknesses
  • The commercial property SJW Land Company (subsidiary) owns in Tennessee are probably reeling due to COVID (no Annual Report available for 2020 yet)
  • Same for Chester Realty (subsidiary) in Connecticut as vacancies and business trends change
  • Overbilling "scandal" in 2017 for some San Jose-area residents
  • They run a "boring" business primarily as a water utility conglomerate in California, Texas, Connecticut, and Maine so new media-based surges in price are unlikely

Strengths
  • Passes my "OK Boomer" test with a dividend that has been increasing consistently for 16 years (ignore incorrect Q42017 data on Nasdaq's website, an extra dividend was paid after a subsidiary was sold)
  • Water utility subsidiaries are distributed on both coasts which limits natural disaster impacts
  • Price negatively impacted like many other companies during mid-February sell-off

All real estate details sourced from 2019 annual report.

TipRank
  • Only 3 Analysts covering SJW Group
  • Median price target $73.50

Chart
  • Price fell beneath the 200-Day SMA on February 25, 2021 as part of a larger sell-off trend
  • 5-Day EMA crossed the 20-Day SMA up on March 24, 2021 and the closing price continues to ramp up
  • RSI increased from 30 to 50 during last week's rally

Summary
Even using a conservative price target of $69 (below the median $73.50 TipRanks price target), SJW Group has about 10% upside based on the current price $62 range. As a "boomer" stock marching towards Dividend Aristocrat status in a "boring" industry, SJW could easily slide from your swing portfolio to your buy-and-hold portfolio.
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