TSX:AQN

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Algonquin Power & Utilities

Executive Summary

Algonquin Power & Utilities Corp., through its subsidiaries, owns and operates a portfolio of regulated and non-regulated generation, distribution, and transmission utility assets in Canada and the United States. More Details


Snowflake Analysis

Average dividend payer and slightly overvalued.


Similar Companies

Share Price & News

How has Algonquin Power & Utilities's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AQN is less volatile than 75% of Canadian stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: AQN's weekly volatility (2%) has been stable over the past year.


Market Performance


7 Day Return

1.2%

AQN

2.2%

CA Integrated Utilities

0.2%

CA Market


1 Year Return

9.8%

AQN

-12.0%

CA Integrated Utilities

1.5%

CA Market

Return vs Industry: AQN exceeded the Canadian Integrated Utilities industry which returned -12% over the past year.

Return vs Market: AQN exceeded the Canadian Market which returned 1.5% over the past year.


Shareholder returns

AQNIndustryMarket
7 Day1.2%2.2%0.2%
30 Day5.1%-1.0%3.6%
90 Day3.8%-4.7%13.3%
1 Year14.8%9.8%-8.7%-12.0%5.2%1.5%
3 Year79.5%56.5%23.7%10.7%13.1%2.3%
5 Year138.9%89.8%62.3%35.3%69.3%43.3%

Long-Term Price Volatility Vs. Market

How volatile is Algonquin Power & Utilities's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Algonquin Power & Utilities undervalued compared to its fair value and its price relative to the market?

40.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AQN (CA$21.47) is trading below our estimate of fair value (CA$36.09)

Significantly Below Fair Value: AQN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: AQN is poor value based on its PE Ratio (20.6x) compared to the XN Integrated Utilities industry average (19.8x).

PE vs Market: AQN is poor value based on its PE Ratio (20.6x) compared to the Canadian market (16.7x).


Price to Earnings Growth Ratio

PEG Ratio: AQN is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: AQN is overvalued based on its PB Ratio (2.2x) compared to the XN Integrated Utilities industry average (1.9x).


Next Steps

Future Growth

How is Algonquin Power & Utilities forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

12.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AQN's forecast earnings growth (12.8% per year) is above the savings rate (1.5%).

Earnings vs Market: AQN's earnings (12.8% per year) are forecast to grow slower than the Canadian market (26.2% per year).

High Growth Earnings: AQN's earnings are forecast to grow, but not significantly.

Revenue vs Market: AQN's revenue (11.6% per year) is forecast to grow faster than the Canadian market (7.9% per year).

High Growth Revenue: AQN's revenue (11.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AQN's Return on Equity is forecast to be low in 3 years time (9.2%).


Next Steps

Past Performance

How has Algonquin Power & Utilities performed over the past 5 years?

52.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AQN has a large one-off gain of $266.2M impacting its September 30 2020 financial results.

Growing Profit Margin: AQN's current net profit margins (27.2%) are lower than last year (30.5%).


Past Earnings Growth Analysis

Earnings Trend: AQN's earnings have grown significantly by 52.9% per year over the past 5 years.

Accelerating Growth: AQN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AQN had negative earnings growth (-9.9%) over the past year, making it difficult to compare to the Integrated Utilities industry average (-0.5%).


Return on Equity

High ROE: AQN's Return on Equity (7.1%) is considered low.


Next Steps

Financial Health

How is Algonquin Power & Utilities's financial position?


Financial Position Analysis

Short Term Liabilities: AQN's short term assets ($760.2M) exceed its short term liabilities ($634.9M).

Long Term Liabilities: AQN's short term assets ($760.2M) do not cover its long term liabilities ($5.6B).


Debt to Equity History and Analysis

Debt Level: AQN's debt to equity ratio (73.7%) is considered high.

Reducing Debt: AQN's debt to equity ratio has reduced from 81.7% to 73.7% over the past 5 years.

Debt Coverage: AQN's debt is not well covered by operating cash flow (12.2%).

Interest Coverage: AQN's interest payments on its debt are not well covered by EBIT (1.9x coverage).


Balance Sheet


Next Steps

Dividend

What is Algonquin Power & Utilities's current dividend yield, its reliability and sustainability?

3.68%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AQN's dividend (3.68%) is higher than the bottom 25% of dividend payers in the Canadian market (1.54%).

High Dividend: AQN's dividend (3.68%) is low compared to the top 25% of dividend payers in the Canadian market (5%).


Stability and Growth of Payments

Stable Dividend: AQN's dividend payments have been volatile in the past 10 years.

Growing Dividend: AQN's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (72.4%), AQN's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AQN's dividends in 3 years are forecast to be covered by earnings (79.8% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.0yrs

Average management tenure


CEO

Arun Banskota (53 yo)

0.50

Tenure

Mr. Arun Banskota serves as the President of Algonquin Power & Utilities Corp. since February 10, 2020 and has been its Chief Executive Officer since July 17, 2020. Mr. Banskota serves as the Director at A...


Leadership Team

NamePositionTenureCompensationOwnership
Anthony Johnston
Chief Operating Officer2yrsUS$1.74m0.00067%
$ 86.1k
Jeffery Norman
Chief Development Officer13yrsUS$1.25m0.0097%
$ 1.2m
Arun Banskota
President0.50yrno data0.0087%
$ 1.1m
Arthur Kacprzak
Chief Financial Officer0.33yrno data0.0013%
$ 167.1k
Amelia Tsang
Vice President of Investor Relationsno datano datano data
Jennifer Tindale
Chief Legal Officer3.92yrsno data0.0067%
$ 856.1k
Mary Paravalos
Chief Compliance & Risk Officerno datano data0.00012%
$ 15.4k
Stephanie Bose
Director of Corporate Communicationsno datano datano data
Kirsten Olsen
Chief Human Resources Officer1.17yrsno datano data
Michael Dilworth
Senior Vice President of Solar Development Group2yrsno datano data
Brenda Marshall
Senior Vice President of Wind Development1.83yrsno datano data
George Trisic
Chief Governance Officer & Corporate Secretary3.83yrsno data0.0055%
$ 709.5k

2.0yrs

Average Tenure

52yo

Average Age

Experienced Management: AQN's management team is considered experienced (2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Arun Banskota
President0.50yrno data0.0087%
$ 1.1m
D. Laney
Independent Director3.92yrsUS$235.71k0.0027%
$ 344.5k
Dilek Samil
Independent Director6.25yrsUS$243.71k0.0025%
$ 322.6k
Christopher G. Huskilson
Independent Director1yrUS$137.57k0.0064%
$ 826.5k
George Steeves
Independent Director11.25yrsUS$218.44k0.0042%
$ 533.4k
Kenneth Moore
Independent Chairman11.25yrsUS$281.97k0.0030%
$ 386.9k
Christopher Ball
Independent Director11.25yrsUS$237.24k0.0040%
$ 520.6k
Masheed Saidi
Independent Director6.58yrsUS$230.53k0.0025%
$ 325.2k
Melissa Barnes
Independent Director4.58yrsUS$218.43kno data

6.3yrs

Average Tenure

64yo

Average Age

Experienced Board: AQN's board of directors are considered experienced (6.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 13.9%.


Top Shareholders

Company Information

Algonquin Power & Utilities Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Algonquin Power & Utilities Corp.
  • Ticker: AQN
  • Exchange: TSX
  • Founded: 1988
  • Industry: Multi-Utilities
  • Sector: Utilities
  • Market Cap: CA$12.854b
  • Shares outstanding: 597.03m
  • Website: https://algonquinpower.com

Number of Employees


Location

  • Algonquin Power & Utilities Corp.
  • 354 Davis Road
  • Suite 100
  • Oakville
  • Ontario
  • L6J 2X1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AQNTSX (The Toronto Stock Exchange)YesCommon SharesCACADDec 1997
AQNNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1997
751DB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1997

Biography

Algonquin Power & Utilities Corp., through its subsidiaries, owns and operates a portfolio of regulated and non-regulated generation, distribution, and transmission utility assets in Canada and the United ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/19 23:14
End of Day Share Price2021/01/19 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.