Water and waste water service provider Connecticut Water Service Inc. CTWS announced that its board of directors has approved an increase in the quarterly dividend rate by 5.6%. The revised quarterly dividend will be 28.25 cents payable on Jun 15, 2016, to shareholders of record at the close of business on Jun 1, 2016.The annualized dividend rate of the company comes to $1.13 while the current dividend yield is 2.3%, better than the S&P 500 yield of 1.74%.Thanks to consistent investments in its regulated operation, Connecticut Water Service is being able to reliably serve its expanding customer base. Also, the improvement in net income enables the company to carry out shareholder friendly moves. Including the current hike the company has increased its dividend rate consecutively in the last 47 years.The company derives nearly 95% of its earnings from regulated operations. Connecticut Water Service is consistently investing in its regulated operations, which ensures a steady earnings stream. The company aims to invest nearly $150 million in the 2016 to 2018 time frame to strengthen its existing water infrastructure.Consolidation is also the need of the hour in the fragmented U.S. water utility space. The old water utility infrastructure needs ample investments which are easier for bigger players to make. Consolidation would therefore drive the necessary infrastructure overhauls that have become imperative for the industry at large.Connecticut Water Service has been engaged in strategic acquisitions of smaller water service providers. In the last 7 years the company made 40 acquisitions, in sync with its expansion plans. Contributions from organic and inorganic assets have placed the company on a strong financial footing, allowing it to carry on shareholder friendly moves.Connecticut Water Service currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the water utility space are The York Water Company YORW, Companhia de Saneamento Basico do Estado de Sao Paulo SBS and Artesian Resources Corp. ARTNA, all carrying a Zacks Rank #2 (Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SABESP -ADR (SBS): Free Stock Analysis Report YORK WATER CO (YORW): Free Stock Analysis Report CONN WATER SVC (CTWS): Free Stock Analysis Report ARTESIAN RES (ARTNA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research