Algonquin Power & Utilities Corp (AQN.TO)

Trades at a reasonable 14x but has no growth now. They're looking at spinning out their renewable business then reaccelerate growth. Too uncertain. Altagas has 14% growth and trades around 11x and pays a similar dividend. Safer than AQN.

Utilities business generally safe business.
Management problems weighing on performance of company.
Too much debt for company of its size.
Good long term investment if willing to hold.
Unsure on future of dividend sustainability. 

She used to own it. They've had floating rate debt problems, shares plunged last year, and they cut their dividend by 40%. Probably good that they didn't buy a company recently, but that may deter their long-term growth. Activist shareholders are now involved. She suffered a sharp decline when she sold. She buys utilities for income, but rising dividends and AQN can't do that for the next few years.

It has a good short term trend and a good dividend. You could buy a starter position - anywhere above $9 to $10 is well supported.

Hold. They cut the dividend in January. A good name that he's owned on and off. The dividend has historically improved and still pays 5%. It is slowing regaining investor trust that was lost in January. These stocks do well during weakness in crude oil.

There's little more upside short-term. No one liked the Kentucky Power deal, so glad it died. There's not much downside here, but there's also not much to entice him to buy it. Boralex and Northland Power, in contrast, offer better growth and balance sheets.

She sold. Dividend cut by 40%. Kentucky Power deal collapse took away that growth opportunity. Reassessing renewable power strategy. Selling assets squashes growth. She'd bought it as an income stock with earnings ability to increase dividend annually, but balance sheet still quite stretched.

They ran into trouble recently by proposing to buy Kentucky Power, but the deal just died. AQN was smart to trim its dividend and they pledge to sell $1 billion of assets, which is the next thing to watch. How much will they receive? Pays a decent yield. The company is aware of its issues. Don't expect much growth here for a while. Collect the dividend and watch shares rise gradually. Ending the Kentucky deal was good; the balance sheet is better.

Likes a lot. Very out of favour and undervalued. Trades at less than 15x earnings, a discount to peers. Good news this week on Kentucky Power, as it gives them a lot more breathing room and doesn't force them into anything. More certainty they'll maintain investment-grade credit rating, not a distressed seller, can look for other assets in a depressed environment. He'd definitely own and buy today.

Caught off-guard with the market with their disappointing performance. Yesterday, they backed out of the Kentucky Power purchase, which is positive, because it gives AQN more time to execute their asset sales. Plan to sell $1 billion worth to fund capital program and pay down debt. The December sell-off was overdone, though is up around 30% YTD, so she sold some shares. Will be little growth, including dividends, in the next few years, but after Kentucky, AQN must sell some assets. She is on the sidelines, and AQN could be a source of funds for other names.

Looks like it'll walk away from Kentucky acquisition. This would significantly help balance sheet and increase cashflow flexibility, so they don't have to sell as many assets. Tough to buy right now, but hold if you own it.

Depends on what happens with Kentucky Power. Latest news is that they're backing away from the acquisition, a move that would really help their balance sheet. Valuation not bad at 13.4x. Models negative EPS growth. He's nibbled, but wouldn't add here. See his Top Picks.

AQN has had poor execution and much lower earnings than expected last year. 
High rates have not helped. 
It also cut its dividend which always makes us more cautious. 
This was after management more or less indicated the dividend was safe, so they lose a point for that too. 
We think it is OK for income. 
Debt is high, and growth is not huge. 
But the company took the painful step on the dividend, and investors' initial reaction was harsh, and it has slowly worked its way higher.  
We would consider it a HOLD. 
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A tough one. When AQN announced it was buying KP, the macro was very different. Now, interest rates are much higher. That said, finding a good fit like KP into AQN is rare and will ultimately benefit AQN, Yes, AQN carries too much debt, but so do other companies like Altagas. However, AQN can sell some assets above value given strong power demand in order to rectify that debt over time. For the whole space, electricity demand across North America has increased given stagnation for a long time. Such stocks are a long-term opportunity. AQN will muddle through this, though maybe longer than short-term investors want. He's sticking with it.

AQN is recovering and remains cheap. 
We think the shareholder base has turned over now (after the dividend cut) and we think it can be held for a couple of quarters to see if the turnaround takes hold.  
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