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Capital Power Corp T.CPX

Alternate Symbol(s):  CPXWF | T.CPX.PR.A | CPRHF | T.CPX.PR.C | CPWPF | T.CPX.PR.E

Capital Power Corporation is a growth-oriented power producer company. The Company develops, acquires, owns, and operates renewable and thermal power generation facilities and manages its related electricity and natural gas portfolios. It is involved in the operation of electrical generation facilities within Canada and in the United States. The Company has approximately 9,300 megawatts (MW) of power generation capacity at 32 facilities across North America. Its projects under construction include over 140 MW of renewable generation capacity and 512 MW of incremental natural gas combined cycle capacity from the repowering of Genesee 1 and 2 in Alberta, and over 350 MW of natural gas and battery energy storage systems in Ontario and approximately 70 MW of solar capacity in North Carolina in advanced development. Its La Paloma facility is located in Kern County, California. The Company also has a Harquahala natural gas generation facility in Arizona.


TSX:CPX - Post by User

Comment by dileas48son Feb 27, 2021 11:43pm
304 Views
Post# 32680635

RE:RE:RE:RE:Should be trading at least 70$

RE:RE:RE:RE:Should be trading at least 70$

Happy to share my perspective, as this is one key area where Sarge and I differ but I'm not suggesting I'm right and he's wrong it's just a different philosophy.

1) yes, in general it is reasonable to expect if the share price rises, the dividend will follow, or in some cases, vice versa.  Some are suggesting the price of CPX could almost double in the short term, because the business is undervalued. Let's assume they're right. I don't think that means the dividend doubles. It may indeed increase, but not double. That would mean the yield would go down. To be clear, if the dividend did double I wouldn't be going anywhere.

2) I don't care about my yield on cost.  If I get a 5% yield on a $100 investment that's $5 in dividends. If the SP doubles, but the dividend doesn't, my yield drops to 2.5%, because I still only get $5.  If I can find another stock with a current yield of 5% then I'd rather buy it and get $10 in dividends.

However, if my investment is not in a registered account then I will have to pay capital gains tax on the $100 ( about $25 ) when I sell my initial position. So, if my theoretical stock is not in my TFSA or my RSP it's a harder decision.

To me, it's a no-brainer for stocks in TFSAs or RSPs, sell to get the higher yield. I want to make all my money work for me, not just my initial investment. 

I am still in the mode of diversifying so I'm doing a fair bit of trading anyway to add new stocks and rebalance my portfolio regularly. I have a triple and a six bagger from the Venture exchange that sooner or later I will need to replace with solid dividend payers. In both cases I'll have to deal with some capital gains unfortunately. 

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