Update shared on 05 Nov 2025
Fair value Increased 2.70%Analysts have modestly raised their price target for Capital Power, increasing it from approximately C$74 to C$76. They cite a series of upward target revisions across the Street that reflect confidence in the company's outlook, despite tempered growth estimates.
Analyst Commentary
Recent research activity reflects a series of upward price target revisions and positive rating initiations for Capital Power, suggesting a generally optimistic stance from the analyst community. The company is viewed as well-positioned within the utilities sector, with noted potential for growth and operational outperformance compared to peers.
Bullish Takeaways- Bullish analysts have significantly raised their price targets, with several now expecting shares to reach or surpass C$80. This reinforces the view that there is upside to current valuation.
- Capital Power is seen as an underappreciated growth story in the utilities space, with prospects that rival larger U.S. counterparts, according to some coverage initiations.
- Most recent research notes maintain Buy or Outperform ratings and point to expected strong execution ahead along with ongoing investor confidence in management’s strategy.
- The volume of upward target revisions reflects not only improved near-term fundamentals but also confidence in the longer-term growth trajectory of the business.
What's in the News
- Announced a Memorandum of Understanding with Carbon TerraVault to jointly develop carbon capture and sequestration solutions for the La Paloma generation facility in California. The collaboration includes plans to evaluate transportation and sequestration services for up to 3 million metric tons of CO2 annually, along with related infrastructure and regulatory considerations. (Key Developments)
- Added to the S&P/TSX Preferred Share Index, enhancing visibility within Canadian capital markets. (Key Developments)
- Successfully achieved commercial operations on the York Battery Energy Storage System (120 MW) and Goreway BESS (50 MW) projects in Ontario. The projects were delivered on time and under budget, and they secured contracted annual EBITDA for over 20 years. (Key Developments)
- Executed a new long-term contract for the Midland Cogeneration Venture with Consumers Energy. The agreement extends contract coverage to 2040 and provides a significant increase in annual adjusted EBITDA for the facility. (Key Developments)
Valuation Changes
- Fair Value Estimate has risen slightly from CA$73.96 to CA$75.96, reflecting modest optimism in overall company valuation.
- Discount Rate has decreased marginally from 7.37 percent to 7.35 percent, indicating a small reduction in perceived risk.
- Revenue Growth Projection has fallen significantly from 5.73 percent to 3.67 percent, which signals tempered expectations for top-line expansion.
- Net Profit Margin is now expected at 16.55 percent, down from 18.93 percent. This suggests a more conservative profitability outlook.
- Future P/E Ratio has increased meaningfully from 24.37x to 28.71x. This may indicate higher anticipated earnings multiples or premium valuations.
Disclaimer
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