Transalta Corp (TA.TO) Buy, Sell or Hold

Transalta Corp (TA.TO)

18.78

-0.00 (0.00%)

as of Oct 13, 2026, 8:00:00 pm Market Open.

235 watching

SELL

(Market Called Minute.) Today's arbitration is going to drag down there cash flow. They still have a lot of issues to work through.

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TOP PICK

(Top Pick July 12/11, Down 17%) Still says it’s a buy. Fell down to a 25 year low so that is very, very cheap and it has a nice dividend. Earnings have barely covered dividend for some time. There is a risk that they cut the dividend but it would still be one of the higher yielding utilizes on the TSX. He doesn’t think they will cut the dividend in the foreseeable time.

DON'T BUY

6.4 maturing Nov 18/19 safe? This is a 7 year piece of paper which is at the sweet spot of the curve. This is a BBB which falls in the moderate risk category. Trading a little expensive given its credit quality.

DON'T BUY

They had missed earnings. A commission out. Dealing with Sundance issues with forced closure. They have not had free cash flow for some time. Had a couple of plant outages. There is a threat that their bond rating may be downgraded. Dividend is safe for now, but one or two more hiccups and they could be vulnerable.

PAST TOP PICK

(Top Pick Jul 4/11, Up 6.00%) He is worried about it. Thinks the investment grade rating will stay. It will be fine until 2014. He probably wont reinvest.

HOLD

Dividend is safe even though they are paying out more than earnings. Not a name she is particularly interested in because there is not a lot of earnings growth. Would prefer a bank or pipeline. You are only getting it for the 6%.

COMMENT

With its recent selloff, it is probably reasonable value. Yield of 6.75% but there has been no growth for a long time. If it could sustain the yield, then it is reasonably priced.

BUY

Somebody said “their earnings are slipping and won't have enough to cover their dividend”. Stock took a dip when that statement came out. Dividend does not really depend on earnings, but on cash flow. Cost of capital is extremely low for these people. There is a little bit of a cloud, but he doesn't think they will cut their dividend.

DON'T BUY

Scrapped their carbon capture project. Is the dividend safe? The real issue is not the carbon capture project. They have a number of challenges going forward. 1.) Have to renegotiate a contract in one of their big power plants in the state of Washington. 2.) They are going to have a large CapX project spending over the next 1.5 years or so. 3.) They are in a litigation situation with Trans Canada (TRP-T) over a shutdown of a power plant. Too many unknowns.

DON'T BUY

Preferreds? Just had some disappointing results. The problem is, they are a regulated utility and have power agreements with the government of Alberta. If they don't perform, they are liable.

DON'T BUY

Not a fan. It is a touch business. The regulators are not guaranteeing a rate for them. They have to be particularly excellent at securing forward sales prices and aligning with commodity inputs. Not is favourite name in this space. Prefers TRP or FTS.

COMMENT

When the stock rope is major support level at about $18, that's when you should have sold. If you own, you are at least having a good yield. Wait till he gets to $18-$19 before buying.

COMMENT

In a little bit of a potential cash bind. In 2012, they have issues with 1) growth capital spending, 2) regular capital spending and a 3) dividend. They are seeing some impairment with their cash flow. It is possible the 7% dividend could be cut. If they didt cut it, they would still have a healthy dividend.

DON'T BUY

Power producer with assets in Western Canada and the Pacific Northwest. One out their Sundance plants went down. They are in a dispute with Trans Canada (TRP-T) and if they are found to be liable, it would take about $100 million to refurbish the plant. Also have some higher cost coal plants.

DON'T BUY

(Market Call Minute) Weakest company in the utilities group – prefers ENB.

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Transalta Corp (TA.TO)