UPDATE: Citi Raises PT on American Water Works to $35

Citi is out with its report today on American Water Works (NYSE: AWK), raising its PT from $32 to $35.

In its report, Citi writes, "We value AWK using a weighted multiple of a 2.5x premium to electric utilities and a 4.0x discount to water utility peers. The yields on BBB corporate bonds currently imply that US electric utilities should be trading at a P/E of 15x, versus a prior group average target multiple of 14x. Including this is in our model raises the AWK target multiple to 17.5x, which boosts our price target to $35/share."

Citi maintains Buy on AWK.

Sares of AWK closed Tuesday at $29.45.