Water Intelligence – will a US listing help to push up this group’s shares after today’s Q1 Trading Update shows continued growth, shares 335p, brokers TP 850p

22.05.2025

This group is dedicated to preserving water and enhancing public health by innovating minimally-invasive water and wastewater infrastructure services.

Its acoustic and infrared-based technology solutions are designed to address issues in pipes of all sizes - small, medium, and large diameter - serving residential, commercial, and municipal customers.

These solutions target leakages and blockages in both clean water and wastewater conveyance systems.

The Business

Water Intelligence (LON:WATR) is a provider of minimally-invasive leak detection and remediation services for potable and non-potable water.

Its segments include Franchise royalty income; Franchise-related activities, including product and equipment sales, business-to-business sales and sales of franchises; US corporate operated locations; International corporate operated locations, and Head office costs.

It operates through two wholly owned subsidiaries: American Leak Detection (ALD) and Water Intelligence International (WII).

ALD delivers services through corporate locations and franchise locations across the United States and in Canada and Australia.

WII operates outside the United States, mainly in the UK, and delivers services only through corporate locations.

Its brands include Wat-er-Save, IntelliDitch and others. It also operates in central Ireland between Shannon and Dublin and serves residential and commercial markets with a mix of service and construction plumbing.

Now the group has a reach over 150 locations, operates in 46 US States, and in a total of 5 countries.

Management Comment

Executive Chairman Dr Patrick DeSouza stated that:

"We have launched a defining partnership with Chubb/StreamLabs and now have the capability to execute a true integrated platform with operations across the US and multinationally, through which we can lead the future of water infrastructure services. 

Preventive Maintenance, rather than Reactive Mitigation, is where the industry is headed to both conserve water and to limit the damage from water leakage. 

Now, as the leading Technology Enabled Service platform for water infrastructure solutions, we have a complete package for residential, commercial and municipal customers: wireless monitoring, secure data and analytics, pinpoint minimally invasive leak detection and repair and aftercare with continuous customer engagement through video moments technology. 

Importantly, while integrating our robust platform to capture market leadership in Preventive Maintenance, we remain focused on continuing to grow revenue and profits, while retaining a strong balance sheet with which to execute our competitive strategy."

Analyst’s Opinions

Analysts Paul Richards and Mark Howson, at Dowgate Capital, rate the group’s shares as a Buy, with a Target Price of 850p.

For the current year to end-December they estimate revenues of $97.0m ($83.3m est), with normalised pre-tax profits of $11.2m ($9.1m est), and with earnings higher at 44.3c (36.6c est) per share.

Following recent acquisitions, the group now provides an end-to-end offering that increases water savings and reduces damages for residential, commercial and municipal customers.

In My View 

With only some 19.45m shares in issue, I believe that the advantages of the group gaining a US listing will boost its investor awareness.

From this month, US investors have been able to invest in the group’s shares through Interactive Brokers.

No doubt we will get an update on the US preparation when the group reports its 2024 Final Results in the middle of next month.

In the meantime, the group’s shares, which have been up to 427.50p and as low as 314p within the last year, are currently trading at around the 335p level, off nearly 7% on the day following this morning’s Q1 Update.

Could this be the time to

buy into the WATR equity?