TSX:INE

Stock Analysis Report

Innergex Renewable Energy

Executive Summary

Innergex Renewable Energy Inc. operates as an independent renewable power producer.

Rewards

Trading at 11.2% below its fair value

Earnings are forecast to grow 37.75% per year

Risk Analysis

Interest payments are not well covered by earnings

Dividend of 4.07% is not well covered by earnings or forecast to be in the next 3 years

Large one-off items impacting financial results

Profit margins (1.6%) are lower than last year (3.2%)

+ 1 more risk


Snowflake Analysis

Moderate growth potential second-rate dividend payer.


Similar Companies

Share Price & News

How has Innergex Renewable Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: INE has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.1%

INE

0.6%

CA Renewable Energy

-0.3%

CA Market


1 Year Return

34.5%

INE

27.0%

CA Renewable Energy

10.7%

CA Market

Return vs Industry: INE exceeded the Canadian Renewable Energy industry which returned 27% over the past year.

Return vs Market: INE exceeded the Canadian Market which returned 10.7% over the past year.


Shareholder returns

INEIndustryMarket
7 Day-0.1%0.6%-0.3%
30 Day4.2%5.9%0.1%
90 Day13.8%11.9%1.7%
1 Year41.4%34.5%33.3%27.0%14.4%10.7%
3 Year40.8%21.7%41.2%22.3%16.0%5.6%
5 Year97.3%53.8%82.4%41.5%41.5%20.6%

Price Volatility Vs. Market

How volatile is Innergex Renewable Energy's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Innergex Renewable Energy undervalued compared to its fair value and its price relative to the market?

11.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: INE (CA$17.2) is trading below our estimate of fair value (CA$19.38)

Significantly Below Fair Value: INE is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: INE is poor value based on its PE Ratio (221.5x) compared to the Renewable Energy industry average (18.2x).

PE vs Market: INE is poor value based on its PE Ratio (221.5x) compared to the Canadian market (15.3x).


Price to Earnings Growth Ratio

PEG Ratio: INE is poor value based on its PEG Ratio (5.9x)


Price to Book Ratio

PB vs Industry: INE is overvalued based on its PB Ratio (4.7x) compared to the CA Renewable Energy industry average (1.8x).


Next Steps

Future Growth

How is Innergex Renewable Energy forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

37.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: INE's forecast earnings growth (37.8% per year) is above the savings rate (1.4%).

Earnings vs Market: INE's earnings (37.8% per year) are forecast to grow faster than the Canadian market (10.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: INE's revenue (3.7% per year) is forecast to grow slower than the Canadian market (4.9% per year).

High Growth Revenue: INE's revenue (3.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if INE's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Innergex Renewable Energy performed over the past 5 years?

61.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: INE has a large one-off loss of CA$9.3M impacting its September 30 2019 financial results.

Growing Profit Margin: INE's current net profit margins (1.6%) are lower than last year (3.2%).


Past Earnings Growth Analysis

Earnings Trend: INE has become profitable over the past 5 years, growing earnings by 61.2% per year.

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

Earnings vs Industry: INE had negative earnings growth (-28.4%) over the past year, making it difficult to compare to the Renewable Energy industry average (-28.4%).


Return on Equity

High ROE: INE's Return on Equity (1.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Innergex Renewable Energy's financial position?


Financial Position Analysis

Short Term Liabilities: INE's short term assets (CA$331.8M) do not cover its short term liabilities (CA$591.8M).

Long Term Liabilities: INE's short term assets (CA$331.8M) do not cover its long term liabilities (CA$4.8B).


Debt to Equity History and Analysis

Debt Level: INE's debt to equity ratio (414.5%) is considered high.

Reducing Debt: INE's debt to equity ratio has increased from 283.3% to 414.5% over the past 5 years.

Debt Coverage: INE's debt is not well covered by operating cash flow (4.7%).

Interest Coverage: INE's interest payments on its debt are not well covered by EBIT (1.1x coverage).


Balance Sheet

Inventory Level: INE has a high level of physical assets or inventory.

Debt Coverage by Assets: INE's debt is not covered by short term assets (assets are 0.1x debt).


Next Steps

Dividend

What is Innergex Renewable Energy's current dividend yield, its reliability and sustainability?

4.07%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Innergex Renewable Energy before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company4.1%marketbottom25%2.0%markettop25%5.7%industryaverage4.4%forecastin3Years4.2%

Current dividend yield vs market & industry

Notable Dividend: INE's dividend (4.07%) is higher than the bottom 25% of dividend payers in the Canadian market (2.02%).

High Dividend: INE's dividend (4.07%) is low compared to the top 25% of dividend payers in the Canadian market (5.68%).


Stability and Growth of Payments

Stable Dividend: INE's dividends per share have been stable in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (895%), INE's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: INE's dividends in 3 years are not forecast to be well covered by earnings (244.1% payout ratio).


Next Steps

Management

What is the CEO of Innergex Renewable Energy's salary, the management and board of directors tenure and is there insider trading?

4.9yrs

Average management tenure


CEO

Michel Letellier (54yo)

12.2yrs

Tenure

CA$1,439,532

Compensation

Mr. Michel Letellier, MBA, has been the Chief Executive Officer and President of Innergex Renewable Energy Inc. since October 25, 2007. Mr. Letellier is responsible for providing strategic leadership and o ...


CEO Compensation Analysis

Compensation vs Market: Michel's total compensation ($USD1.09M) is below average for companies of similar size in the Canadian market ($USD2.15M).

Compensation vs Earnings: Michel's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.9yrs

Average Tenure

Experienced Management: INE's management team is considered experienced (4.9 years average tenure).


Board Age and Tenure

4.2yrs

Average Tenure

62yo

Average Age

Experienced Board: INE's board of directors are considered experienced (4.2 years average tenure).


Insider Trading

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


Recent Insider Transactions

BuyCA$13,57722 May 19
Jean-François Neault
EntityIndividual
Role
Chief Financial Officer
Chief Financial Officer
Shares970
Max PriceCA$14.00
BuyCA$25,05117 May 19
Jean-François Neault
EntityIndividual
Role
Chief Financial Officer
Chief Financial Officer
Shares1,825
Max PriceCA$13.76
BuyCA$50,07817 May 19
Richard Gagnon
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares3,650
Max PriceCA$13.72
BuyCA$41,47016 May 19
M. Daniel Lafrance
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares3,000
Max PriceCA$13.83
SellCA$3,496,30129 Mar 19
Sitka Foundation, Endowment Arm
EntityCompany
Shares246,666
Max PriceCA$14.19

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 7.1%.


Management Team

  • Jean Trudel

    Chief Investment Officer & Head of Development

    • Tenure: 4.9yrs
    • Compensation: CA$630.52k
  • Michel Letellier (54yo)

    President

    • Tenure: 12.2yrs
    • Compensation: CA$1.44m
  • François Hébert

    Senior Vice President of Hydroelectric Energy

    • Tenure: 8.9yrs
    • Compensation: CA$503.75k
  • Renaud De Batz de Trenquelléon

    Senior Vice President of Latin America

    • Tenure: 4.9yrs
    • Compensation: CA$486.47k
  • Richard Blanchet

    Senior Vice President of Hydro & Special Projects

    • Tenure: 8.9yrs
    • Compensation: CA$352.87k
  • Peter Grover

    Senior Vice President of Wind & Solar Energy

    • Tenure: 8.9yrs
    • Compensation: CA$523.55k
  • Jean-François Neault

    Chief Financial Officer

    • Tenure: 1.1yrs
    • Compensation: CA$260.12k
  • Karine Vachon

    Director – Communications

    • Tenure: 0yrs
  • Anne Cliche

    Vice-President of Human Resources

    • Tenure: 4.9yrs
  • Yves Baribeault

    Vice President of Legal Affairs

    • Tenure: 4.9yrs

Board Members

  • Monique Mercier (62yo)

    Independent Director

    • Tenure: 4.2yrs
    • Compensation: CA$86.00k
  • Ross Beaty (67yo)

    Independent Director

    • Tenure: 1.8yrs
    • Compensation: CA$64.60k
  • Richard Gagnon (62yo)

    Independent Director

    • Tenure: 2.6yrs
    • Compensation: CA$109.50k
  • M. Daniel Lafrance (64yo)

    Independent Director

    • Tenure: 9.5yrs
    • Compensation: CA$112.00k
  • Ouma Sananikone (61yo)

    Independent Director

    • Tenure: 0.8yrs
  • Michel Letellier (54yo)

    President

    • Tenure: 12.2yrs
    • Compensation: CA$1.44m
  • Jean La Couture (73yo)

    Independent Chairman

    • Tenure: 9.8yrs
    • Compensation: CA$177.50k
  • Dalton James McGuinty (63yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: CA$80.00k
  • Nathalie Francisci (48yo)

    Independent Director

    • Tenure: 2.6yrs
    • Compensation: CA$92.00k

Company Information

Innergex Renewable Energy Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Innergex Renewable Energy Inc.
  • Ticker: INE
  • Exchange: TSX
  • Founded: 1990
  • Industry: Renewable Electricity
  • Sector: Utilities
  • Market Cap: CA$2.392b
  • Shares outstanding: 139.41m
  • Website: https://www.innergex.com

Number of Employees


Location

  • Innergex Renewable Energy Inc.
  • 1225 Saint-Charles Street West
  • 10th Floor
  • Longueuil
  • Quebec
  • J4K 0B9
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
3IXDB (Deutsche Boerse AG)YesCommon SharesDEEURMar 2010
INETSX (The Toronto Stock Exchange)YesCommon SharesCACADMar 2010
INGX.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDMar 2010
INE.PRATSX (The Toronto Stock Exchange)CV PFD SER ACACADSep 2010

Biography

Innergex Renewable Energy Inc. operates as an independent renewable power producer. It develops, owns, and operates run-of-river hydroelectric facilities, wind farms, solar photovoltaic farms, and geotherm ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 00:20
End of Day Share Price2019/12/06 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.