TransAlta Valuation

Is TA undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of TA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TA (CA$8.45) is trading above our estimate of fair value (CA$1.83)

Significantly Below Fair Value: TA is trading above our estimate of fair value.


Key Valuation Metric

Which metric is best to use when looking at relative valuation for TA?

Other financial metrics that can be useful for relative valuation.

TA key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue2.2x
Enterprise Value/EBITDA4.4x
PEG Ratio-0.03x

Price to Earnings Ratio vs Peers

How does TA's PE Ratio compare to its peers?

The above table shows the PE ratio for TA vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average22.9x
CPX Capital Power
6.5x-53.1%CA$4.7b
MXG Maxim Power
8xn/aCA$223.9m
BLX Boralex
34.8x17.0%CA$2.8b
RNW TransAlta Renewables
42.2x46.4%CA$3.3b
TA TransAlta
4x-125.7%CA$2.6b

Price-To-Earnings vs Peers: TA is good value based on its Price-To-Earnings Ratio (4x) compared to the peer average (16.4x).


Price to Earnings Ratio vs Industry

How does TA's PE Ratio compare vs other companies in the Global Renewable Energy Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a4.4%
n/an/an/a
No. of CompaniesPE048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a4.4%
n/an/an/a
No more companies

Price-To-Earnings vs Industry: TA is good value based on its Price-To-Earnings Ratio (4x) compared to the Global Renewable Energy industry average (17.3x).


Price to Earnings Ratio vs Fair Ratio

What is TA's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TA PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio4x
Fair PE Ratio1.3x

Price-To-Earnings vs Fair Ratio: TA is expensive based on its Price-To-Earnings Ratio (4x) compared to the estimated Fair Price-To-Earnings Ratio (1.3x).


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst TA forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentCA$8.45
CA$14.06
+66.4%
20.8%CA$18.50CA$9.00n/a8
Apr ’25CA$8.69
CA$13.78
+58.5%
20.8%CA$18.50CA$9.00n/a9
Mar ’25CA$9.26
CA$13.89
+50.0%
19.4%CA$18.50CA$10.00n/a9
Feb ’25CA$9.76
CA$14.61
+49.7%
16.4%CA$18.00CA$10.00n/a9
Jan ’25CA$11.02
CA$15.00
+36.1%
13.1%CA$18.00CA$12.00n/a9
Dec ’24CA$11.09
CA$15.00
+35.3%
13.1%CA$18.00CA$12.00n/a9
Nov ’24CA$10.38
CA$15.40
+48.4%
9.6%CA$17.50CA$13.00n/a10
Oct ’24CA$11.83
CA$16.30
+37.8%
10.4%CA$19.00CA$14.00n/a10
Sep ’24CA$13.01
CA$16.68
+28.2%
11.7%CA$20.00CA$14.00n/a11
Aug ’24CA$13.45
CA$16.23
+20.6%
12.5%CA$20.00CA$13.00n/a11
Jul ’24CA$12.40
CA$16.25
+31.0%
12.2%CA$20.00CA$13.00n/a12
Jun ’24CA$13.02
CA$16.17
+24.2%
13.2%CA$20.00CA$12.00n/a12
May ’24CA$12.21
CA$15.79
+29.3%
12.6%CA$20.00CA$12.00n/a12
Apr ’24CA$11.82
CA$15.67
+32.5%
11.5%CA$20.00CA$13.00CA$8.6912
Mar ’24CA$11.07
CA$15.67
+41.5%
11.5%CA$20.00CA$13.00CA$9.2612
Feb ’24CA$12.79
CA$15.79
+23.5%
12.4%CA$20.00CA$12.00CA$9.7612
Jan ’24CA$12.11
CA$15.96
+31.8%
12.9%CA$20.00CA$12.00CA$11.0212
Dec ’23CA$12.75
CA$16.33
+28.1%
10.3%CA$20.00CA$14.00CA$11.0912
Nov ’23CA$11.81
CA$15.79
+33.7%
12.0%CA$20.00CA$13.00CA$10.3812
Oct ’23CA$12.21
CA$16.50
+35.1%
10.9%CA$20.00CA$14.00CA$11.8312
Sep ’23CA$12.25
CA$16.33
+33.3%
7.9%CA$18.00CA$14.00CA$13.0112
Aug ’23CA$14.66
CA$16.54
+12.8%
8.0%CA$18.50CA$14.50CA$13.4512
Jul ’23CA$14.69
CA$16.67
+13.5%
6.4%CA$18.00CA$15.00CA$12.4012
Jun ’23CA$14.48
CA$16.21
+11.9%
8.0%CA$18.00CA$14.00CA$13.0212
May ’23CA$13.78
CA$16.13
+17.0%
8.7%CA$18.00CA$14.00CA$12.2112
Apr ’23CA$12.99
CA$15.92
+22.5%
9.0%CA$17.00CA$13.00CA$11.8212

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.


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