Executive Summary
TransAlta Corporation operates as non-regulated electricity generation and energy marketing company in Canada, the United States, and Western Australia.
Rewards
Risk Analysis
Earnings are forecast to decline by an average of -21% per year for the next 3 years
+ 1 more risk
Snowflake Analysis
Good value with mediocre balance sheet.
Similar Companies
Share Price & News
How has TransAlta's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: TA's share price has been volatile over the past 3 months.
Market Performance
7 Day Return
2.8%
TA
2.3%
CA Renewable Energy
2.7%
CA Market
1 Year Return
-10.0%
TA
13.3%
CA Renewable Energy
-11.5%
CA Market
Return vs Industry: TA underperformed the Canadian Renewable Energy industry which returned 13.3% over the past year.
Return vs Market: TA exceeded the Canadian Market which returned -11.5% over the past year.
Shareholder returns
| TA | Industry | Market | |
|---|---|---|---|
| 7 Day | 2.8% | 2.3% | 2.7% |
| 30 Day | -1.7% | -0.8% | 1.6% |
| 90 Day | -19.9% | -8.1% | -8.4% |
| 1 Year | -8.3%-10.0% | 18.5%13.3% | -8.5%-11.5% |
| 3 Year | 10.3%3.7% | 29.6%12.2% | -0.5%-9.8% |
| 5 Year | -5.7%-19.3% | 75.2%37.0% | 14.6%-2.4% |
Price Volatility Vs. Market
How volatile is TransAlta's share price compared to the market and industry in the last 5 years?
Simply Wall St News
1 week ago | Simply Wall St
Should You Worry About TransAlta Corporation's (TSE:TA) CEO Pay Cheque?1 month ago | Simply Wall St
TransAlta Corporation's (TSE:TA) On An Uptrend But Financial Prospects Look Pretty Weak: Is The Stock Overpriced?2 months ago | Simply Wall St
Is It Too Late To Consider Buying TransAlta Corporation (TSE:TA)?Valuation
Is TransAlta undervalued compared to its fair value and its price relative to the market?
>50%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: TA (CA$8.05) is trading below our estimate of fair value (CA$42.38)
Significantly Below Fair Value: TA is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: TA is good value based on its PE Ratio (15.7x) compared to the Renewable Energy industry average (25.8x).
PE vs Market: TA is poor value based on its PE Ratio (15.7x) compared to the Canadian market (12.7x).
Price to Earnings Growth Ratio
PEG Ratio: TA's earnings are forecast to decline next year, so we can't calculate its PEG ratio.
Price to Book Ratio
PB vs Industry: TA is good value based on its PB Ratio (1.1x) compared to the CA Renewable Energy industry average (1.6x).
Next Steps
Future Growth
How is TransAlta forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?
-21.0%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: TA's earnings are forecast to decline over the next 3 years (-21% per year).
Earnings vs Market: TA's earnings are forecast to decline over the next 3 years (-21% per year).
High Growth Earnings: TA's earnings are forecast to decline over the next 3 years.
Revenue vs Market: TA's revenue is expected to decline over the next 3 years (-1.9% per year).
High Growth Revenue: TA's revenue is forecast to decline over the next 3 years (-1.9% per year).
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: Insufficient data to determine if TA's Return on Equity is forecast to be high in 3 years time
Next Steps
Past Performance
How has TransAlta performed over the past 5 years?
-39.1%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: TA has a large one-off gain of CA$217.0M impacting its March 31 2020 financial results.
Growing Profit Margin: TA became profitable in the past.
Past Earnings Growth Analysis
Earnings Trend: TA has become profitable over the past 5 years, growing earnings by -39.1% per year.
Accelerating Growth: TA has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Earnings vs Industry: TA has become profitable in the last year, making it difficult to compare its past year earnings growth to the Renewable Energy industry (-19.7%).
Return on Equity
High ROE: TA's Return on Equity (6.1%) is considered low.
Next Steps
Financial Health
How is TransAlta's financial position?
Financial Position Analysis
Short Term Liabilities: TA's short term assets (CA$1.4B) exceed its short term liabilities (CA$1.1B).
Long Term Liabilities: TA's short term assets (CA$1.4B) do not cover its long term liabilities (CA$4.2B).
Debt to Equity History and Analysis
Debt Level: TA's debt to equity ratio (82.2%) is considered high.
Reducing Debt: TA's debt to equity ratio has reduced from 105.3% to 82.2% over the past 5 years.
Debt Coverage: TA's debt is well covered by operating cash flow (29.1%).
Interest Coverage: TA's interest payments on its debt are not well covered by EBIT (1.5x coverage).
Balance Sheet
Next Steps
Dividend
What is TransAlta's current dividend yield, its reliability and sustainability?
2.11%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: TA's dividend (2.11%) is higher than the bottom 25% of dividend payers in the Canadian market (2.04%).
High Dividend: TA's dividend (2.11%) is low compared to the top 25% of dividend payers in the Canadian market (6.39%).
Stability and Growth of Payments
Stable Dividend: TA's dividend payments have been volatile in the past 10 years.
Growing Dividend: TA's dividend payments have fallen over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonably low payout ratio (31.7%), TA's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: TA's dividends in 3 years are not forecast to be well covered by earnings (406.7% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
2.8yrs
Average management tenure
CEO
Dawn Farrell (59yo)
8.33yrs
Tenure
CA$6,760,014
Compensation
Ms. Dawn Lorraine Farrell has been the Chief Executive Officer and President at TransAlta Corporation since January 2, 2012. Ms. Farrell served as the Chief Operating Officer of TransAlta Corporation from ...
CEO Compensation Analysis
Compensation vs Market: Dawn's total compensation ($USD4.91M) is above average for companies of similar size in the Canadian market ($USD2.08M).
Compensation vs Earnings: Dawn's compensation has been consistent with company performance over the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 8.33yrs | CA$6.76m | 0.16% CA$3.6m | |
| Chief Financial Officer | 1yr | CA$1.56m | 0.0099% CA$218.2k | |
| Chief Operating Officer | 0.83yr | CA$2.77m | 0.052% CA$1.1m | |
| Chief Shared Services Officer | 2.33yrs | CA$1.94m | 0.031% CA$676.4k | |
| Chief Development Officer | no data | CA$2.63m | 0.061% CA$1.3m | |
| Manager of Investor Relations | no data | no data | no data | |
| Chief Officer of Legal | 1.33yrs | no data | no data | |
| Manager of Communications | 5.92yrs | no data | no data | |
| Executive Vice-President of Generation | 6yrs | CA$1.79m | 0.024% CA$520.7k | |
| Senior Vice-President of Growth | 3.33yrs | no data | 0.015% CA$325.4k |
2.8yrs
Average Tenure
54.5yo
Average Age
Experienced Management: TA's management team is considered experienced (2.8 years average tenure).
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 8.33yrs | CA$6.76m | 0.16% CA$3.6m | |
| Independent Director | 1.08yrs | CA$163.00k | no data | |
| Independent Director | 1.08yrs | CA$109.01k | no data | |
| Independent Director | 6.08yrs | CA$267.40k | 0.0018% CA$39.9k | |
| Independent Director | 7.08yrs | CA$278.23k | 0.0023% CA$51.2k | |
| Independent Chair of the Board | 0.083yr | CA$182.50k | 0.0011% CA$25.4k | |
| Independent Director | 5.08yrs | CA$246.50k | 0.0068% CA$149.8k | |
| Independent Director | 9.33yrs | CA$232.23k | 0.0022% CA$47.4k | |
| Independent Director | 2.08yrs | CA$169.00k | 0.0074% CA$163.5k | |
| Independent Director | 2.83yrs | CA$166.00k | 0.0032% CA$71.3k |
4.0yrs
Average Tenure
64.5yo
Average Age
Experienced Board: TA's board of directors are considered experienced (4 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: TA insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
TransAlta Corporation's company bio, employee growth, exchange listings and data sources
Key Information
- Name: TransAlta Corporation
- Ticker: TA
- Exchange: TSX
- Founded: 1909
- Industry: Independent Power Producers and Energy Traders
- Sector: Utilities
- Market Cap: CA$2.206b
- Shares outstanding: 275.78m
- Website: https://www.transalta.com
Number of Employees
Location
- TransAlta Corporation
- 110-12th Avenue SW
- PO Box 1900
- Calgary
- Alberta
- T2P 2M1
- Canada
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| TAC | NYSE (New York Stock Exchange) | Yes | Common Shares | US | USD | Jan 1988 |
| TA | TSX (The Toronto Stock Exchange) | Yes | Common Shares | CA | CAD | Jan 1988 |
| TZ1 | DB (Deutsche Boerse AG) | Yes | Common Shares | DE | EUR | Jan 1988 |
| TA.PRD | TSX (The Toronto Stock Exchange) | CUML RED PFD-A | CA | CAD | Dec 2010 | |
| TNSS.F | OTCPK (Pink Sheets LLC) | CUML RED PFD-A | US | CAD | Dec 2010 | |
| TA.PRJ | TSX (The Toronto Stock Exchange) | 5.3% CUM PFD G | CA | CAD | Aug 2014 | |
| TRNP.F | OTCPK (Pink Sheets LLC) | 5.3% CUM PFD G | US | USD | Aug 2014 |
Biography
TransAlta Corporation operates as non-regulated electricity generation and energy marketing company in Canada, the United States, and Western Australia. It operates through Canadian Coal, U.S. Coal, Canadian Gas, Australian Gas, Wind and Solar, Hydro, and Energy Marketing segments. The company generates and markets electricity through various generation fuels, such as coal, natural gas, water, solar, and wind. It also engages in wholesale trading of electricity and other energy-related commodities and derivatives. The company operates facilities with approximately 8,385 megawatts of aggregate generating capacity. TransAlta Corporation was founded in 1909 and is headquartered in Calgary, Canada.
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/05/30 02:50 |
| End of Day Share Price | 2020/05/29 00:00 |
| Earnings | 2020/03/31 |
| Annual Earnings | 2019/12/31 |
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.