Opinions
Paul Tepsich
Transalta Corp
TA-T
COMMENT
Apr 25, 2016
Stock price when the opinion was issued
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We reiterate this Canadian based developer of renewable energy as a TOP PICK. They recently announced the startup of a 200MW wind project in Oklahoma that is fully contracted - their 30th successful wind project. Shares trade at 12x earnings and support a robust 33% ROE. Quarterly cash reserves are growing again, while debt is retired and shares bought back. We continue to recommend a stop at $8.50, looking to achieve $13.00 -- upside potential of 26%. Yield 2.2%
(Analysts’ price target is $13.75)Ton of drama for many years. Exciting play when it separated out RNW, but then they put them back together. Underperformed since then. Not a bad name, but doesn't have the nice dividend that others in the space do.
Not the first place he'd put money. Dead money absent other catalysts. On a really sharp pullback, you could add. If you own it, it's a fine hold.
Our PAST TOP PICK with TA has triggered its stop at $16. To remain disciplined, we recommend covering the position at this time. Combined with our previous guidance, this will result in a net investment gain of 46%.
He's looking at it. It's softened up considerably. Decent dividend payer, cut a few years ago but now back on track. High-quality company with share price having sold off. An opportunity, but he hasn't pulled the trigger yet.
Spike on chart due to strong earnings and a bunch of analysts giving it a "Buy". Got ahead of itself. Disappointment recently. He doesn't like buying at all-time highs, where there's often more downside than upside.
2019 bonds for a small portion of a portfolio? This company has kind of fallen on hard times. They are holding about 7X leverage, which is high. Thinks the bonds trade at around 7% which is not overly cheap. If you do this, it will require more diligence.