Capital Power (CPX.TO)

Likes the business. Yield is pretty good. One issue management sees is that Alberta government has to get its act together for data centre projects to come to fruition. (He curls with an AI consultant who said that everyone's going to Texas:  land, nat gas, minimal regulations.)

Has projects in US. Power demand will skyrocket no matter where AI is situated.

Recent earnings were in line. Great acquisition in Pennsylvania last year, which is getting increased prices. Front-and-centre for Alberta data centres. Trades at 8.5x forward operating cashflow. Good, safe utility play in growing areas.

Has done well because demand for power has shot through the roof, so its assets have been revalued significantly higher. Very well managed. Surplus of power, and chances are low this year that that excess will be released. Has opportunities in US to transition from coal to nat gas. 

If you're focused on Canada, he'd be a buyer today as a derivative AI play. But his preference to play AI would be MSFT with a little bit of ORCL.

If you want dividends, look at Canadian pipelines rather than this. CPX is a play on AI centre growth in Alberta, which is great. He owns ALA instead.

Dividend growth is expected at 2% to 4%. These numbers are OK, but we think investors are disappointed that dividend growth is not set higher. CPX is taking a 'growth' route and this may be at the expense of dividend growth and this has disappointed some.
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A clean story with strong visibility in the space.

Support is $60, then at $55. Is not trading like a traditional utility, which are following AI stocks. The selling will continue in these sectors. The stock needs time before it stabilizes and could rise again if AI stocks do.

(Note the short timeframe.)  More newsworthy lately because data centres are looking to set up shop in Alberta with its cheaper power. In his mind, only a matter of time before it partners with one of the hyperscalers.

People looking at long-life, more-utility-type assets are focusing more on electrical power generation than on the pipelines. In that camp, you might look at this name.

Likes the regulated utilities. 

Alberta data centres' growth is fantastic, tapping into CPX nat gas power generation. Massive price increase on a new contract.

Starting to see the sector as a whole turn around. Ranks 9/10 on value, 8/10 on fundamentals. Quietly transforming from coal to lower carbon. Last quarter was strong, with earnings ahead of expectations. Solid performance in US assets. Still 10% upside from here, though taking some profit not a bad idea.

Active in M&A, so she's watching leverage closely. Balance sheet is strong enough to carry that. Dividend continues to grow, yielding just over 4%, and management confirms plans to increase it to 6% this year. 

Its 65% rise in 2024 was based on speculative rumours of data centres in Alberta. Need to see something concrete on that. She's concerned about the recent move since April. You'd do better owning ENB or PPL, which have more secure (as opposed to speculative) growth. Yield is 4.75%.

A bit volatile. Not a regulated distribution utility, it's a power generator. Divested from coal, now predominantly nat gas. Mostly in Alberta, a bit in US. Ran up (way too much) in 2024 due to vague rumours of data centres being built in Alberta; be cautious until we hear more.

She'd rather own a power generator with more consistent growth such as NPI or BEP.UN.

Renewable power assets all across the US and Canada. Natural gas is big for them; also wind, solar, and battery. Numbers reported this morning came out well ahead (by 17%) of consensus. Managed costs effectively in the quarter. Likes the management team. Yield is 5.11%.