United Utilities Earnings: Back to Black, as Expected, Fiscal 2024 Guidance Confirmed, Shares Rich

We maintain our fair value estimate of GBX 960 per share along with our no-moat rating after United Utilities released fiscal 2024 first-half results boosted by the indexation to high inflation of last year and a reduction in finance expense. The interim dividend is set at GBX 16.59, 5.7% higher than last year. The final dividend should also grow by 5.7%, implying a total fiscal 2024 dividend of GBX 48.1 and a 4.4% yield, in line with the sector median. Still, we view the shares as overvalued as evidenced by a fiscal 2024 P/E of 36 times.