Northland Power Inc (NPI.TO)

Renewable space facing headwinds from interest rates and project costs. Some new agreements are inflation-indexed. A long-term, attractive sector. She's chosen BEP.UN, as it's more diversified, larger cap, global scale.

There has been a big pullback. It has great offshore properties as well as onshore. Headwinds caused by high interest rates should lessen.

Higher interest rates weighing down share price. 
Demand for electricity rising.
Business model looks safe.
Good hard assets for long term investor.

NPI is trading at a 20.6x Forward P/E and yielding 4.9%. It is a company that has executed well in the past and some wind projects should be coming on line soon, contributing to growth. After the declines here, we would prefer to hold at this stage. 
Unlock Premium - Try 5i Free

Though few years for the business.
Renewables business sector being hit hard.
Rising interest rates hard on business (borrowing costs up).
Very large projects will be harder to complete with higher borrowing costs.
Owns shares, buying on weakness. 

Regulatory issues in Spain. A great stock that needs to be owned longer term by ESG investors. Not much EPS growth for the next couple of years, very expensive valuation.

Rogers is a cheaper telecom. Synergies coming from Shaw. Nice dividend. Telcos will be facing more competition. 

Risk/reward is good for both, so you can get in and do well, but Rogers is the lower-risk play.

The overall industry has been hit hard, and we think most of the 'bubble'-ness is out. NPI has a strong advantage in the wind segment and we think the growth prospects look solid. A combination of long-dated assets and rising interest rates have not been very polite to the renewable industry. However, this is more industry related than company driven. If patience is running out, we would be okay switching out, but fundamentally we think NPI is OK. 
Unlock Premium - Try 5i Free

He's not as bullish on renewables. Cost of these projects is very high, and it takes a long time to earn this money back. His portfolios tilt towards energy, rather than renewables. Look elsewhere.

The whole green space was bid up, and then got hit with higher interest rates. If we're in a higher for longer rate environment, you want the utilities with the best growth profile. FTS and BIP.UN have really strong growth profiles. He believes rates will start to come down, and share prices of utilities will improve.

The issue is interest rates. If you bought for the dividend then you can hold for when interest rates are lower. If you bought for growth then sell it.

All renewables got ahead of themselves. Some exposure to price caps in UK. Longer term, you want exposure to renewables and NPI should participate. Good long-term hold in the offshore wind space.

He scaled back on a lot of renewables. A great long-term investment theme, but interest sensitive and also cost sensitive. Laying out huge amounts of capital for development projects. With labour and material costs going up, hard to maintain level of investment returns they're used to. It's about rising rates and capturing that investment return. He owned it until recently.

Experts at offshore wind. Cost overruns are manageable. Overhang is financing huge backlog of projects. Market didn't like its issuing shares. Bond hybrid now funds its needs. Taiwan project has political risk. Huge opportunities in Europe. Possible acquisition target because it's small.