If investing were to be made based on the research of the American Society of Civil Engineers, portfolios would be loaded up with water utility stocks. In its recent annual study, Report Card for America’s Infrastructure, very poor reviews were in order. From that, profitable investing in the sector should be on tap for those buying shares of the companies that will upgrade the water infrastructures for the United States and other countries around the world.

Based in Pennsylvania, Aqua America Inc. is a holding company for a group of utilities with customers primarily on the East Coast of the United States. Overall, there are about 3 million customers in 13 states. Sales and earnings-per-share growth has been modest, but steady over the past five years. With a dividend yield of 2.35%, it has become attractive to investors in a low interest rate environment as the average for a member company of the Standard & Poor’s 500 Index is around 2%. As a result, for 2013 it is up 22.76%.

For more international exposure, Danaher Corp. designs, manufactures, and markets professional, medical, industrial, and commercial products and services for markets not only in North America, but also Europe, and Asia/Australia. Almost one-quarter of the profits emanate from its environmental segment, which focuses on water quality issues. Over the last five years, both sales growth and earnings-per-share growth has been in double digits. This is expected to continue with the analyst community projecting earnings-per-share growth of 11.55% for the next five years.

With about two thirds of its business outside the United States, Xylem Inc. is a major player in water infrastructure projects around the world. This global presence has analysts predicting earnings-per-share growth of 7.25% for the next five years, about 20% higher than that for this year. Now trading around $27 a share, the mean analyst target price for Xylem over the next year of market action is $30.85.

The Pall Corp also operates in the United States and around the world. Headquartered in New York, Pall Corp has targeted the Middle East for expansion with a partnership focused on water treatment with King Abdullah University of Science and Technology in Saudi Arabia. The company recently opened its second office in the region, due to the increasing demand. Trading just under $70 a share, Pall Corp. is up more than 30% for the last year. Earnings-per-share are expected to increase by more than 10% next year, and over 14% for the next half decade.

For those seeking income from emerging market exposure, Companhia de Saneamento Basico do Estado Sau Paulo is a Brazilian utility with an above average yield of 3.50%. The utility provides water and sanitation to nearly 24 million people in the sixth largest economy in the world, as ranked by gross domestic product. Unlike the others in this sector, Companhia de Saneamento Basico do Estado Sau Paulo is off due to a recent downgrade by Zacks Equity Research. At around $11.60, it is down 4.51% for the last week, and off 12.80% for the year.

Trillions will have to be spent to upgrade the water infrastructure systems around the world. Even more will be needed for projects in emerging market nations to handle the expansion of the consumer class. While water utility stocks have done well due to the record setting surge in the markets, investors should look to buy on the dips and hold for long term growth and income.