National Bank Raises Price Targets National Bank Raises Price Targets on Six Companies Amid Increased Interest in Renewables
MT Newswires - May 28, 2024 11:56 AM EDT
11:56 AM EDT, 05/28/2024 (MT Newswires) -- National Bank said Monday that it has raised the price targets on six companies across the renewable power infrastructure sector while maintaining the price targets on two companies.
Northland Power's (NPI.TO) price target was raised to C$34 from C$32; the price target on Innergex Renewable Energy (INE.TO) was raised to C$16 from C$15; Brookfield Renewable Partners' (BEP-UN.TO) price target was raised to US$32 from C$30; and Boralex's (BLX.TO) price target was raised to C$43 from C$41. The rating on these companies is outperform.
The price target on Atlantica Sustainable Infrastructure (AY) was raised to US$22 from C$20; and Algonquin Power & Utilities' (AQN.TO) target was raised to US$7.25 from US$6.75. The rating on these companies is sector perform.
National Bank maintained the price targets on Altius Renewable Royalties (ARR.TO) at C$11; and Polaris Renewable Energy (PIF.TO) at C$19.
The bank said the increase in power demand in Canada and globally has increased interest in renewables and valuations are improving.
"Power demand in North America could double over the next 25 years, backed by data centre demand, electrification, reshoring of manufacturing and population growth. With this and a market push to green power, the sector has a long runway," the analysts said.
Also, the bank said independent power producers with exposure to the Canadian market are well positioned, as the market seems to have less competition and is expected to benefit from a 30% Canadian investment tax credit.
The analysts noted that Boralex, Northland Power, Innergex, and Brookfield have done well in RFPs in Ontario and Quebec for wind power and battery capacity.
"We believe the stocks have upside with increasing confidence in the outlook for growth and recovering valuations," the analysts added.
With a 12-month forecast for the US and Canadian 10-year bond yields at 4% and 3.2%, respectively, and a lower MRP forecast, the bank has raised price targets on companies.
The top picks on return to target are Innergex, Northland Power, Polaris Renewable Energy, and Boralex.
Price: 9.04, Change: +0.04, Percent Change: +0.39