Algonquin Power & Utilities Corp T.AQN

Phew, am I ever relieved...

[BSdetector2016]

They would be skewered if the issued shares at current price levels. I interpret this to mean that dilution is delayed until 2023. Why buy it now?

As a result of this transaction, the company does not intend to issue any equity through the remainder of 2022, and has ceased issuances under its at-the-market-equity (ATM). The company indicated it is evaluating further assets sales as a core part of its capital plan for 2023 and beyond.

[Humanist]

I don't understand it as a sure thing that there will be dilution in 2023, but i read it as in preperation if thye need $ they will issue shares. i think it has a lot ot do with  the interest rate hikes and it continues..so it might be cheaper for them to issue shares than to borrow money if the int rates continue to rise ( as expected)  also aqn is well known for acqquisition, so

[jx7000]

That's right--why buy it now. About eight-or-so years ago I was invested in TransAlta Utilities because they used to pay a good div and seemed to be pretty stable, but then that changed with new management, etc. They've never recovered both stock price and div. I wonder if AQN is going "down" the same path for whatever reason.

[TickerTwit]

It's a very dim memory now, but I recall something about regulatory changes to the power market in Alberta being what crucified TransAlta -- they weren't structured right to respond to the changes. Again, a dim memory so don't rely on me. AQN is potentially exposed as well; few operators in regulated space are equipped to defend against radical changes to the markets (water/sewer and

[BSdetector2016]

Unfortunately I'm seeing a near-carbon copy of the AltaGas fiasco being played out. ALA's WGL acquisition at all costs resulted in them diluting themselves to kingdom come, and selling excellent assets to pay for it. Then there was the DRIP which auto-diluted the company as the share price tanked. Algonquin has now adopted this "we got to have it" mentality with its dubious

[Quintessential1]

Why Buy it now? How about because a forward looking market should have already priced in 2023 dillution? Maybe...LOL I am looking here and if this is not the bottom is has to be approaching fast.  Blink and you'll mis it. Very few industries do well in recessions and therefore very few stocks.  This could be one of them. The big question is: Is the dividend sustainable or will

[BSdetector2016]

You have a point about a forward looking market. The trouble is this market seems to be incredibly short-sighted. Add to that bad management decisions, interest rate debt pressure and a bad environment for Utilities. To me it means a sustained bear trend for AQN. Look what  ALA did to itself and it didn't have rising rates to worry about. Banskota needs to kill the bad Kentucky deal and

[Quintessential1]

Is the Kentucky deal bad?    IKentucky Power is bad yeah, but isn't that what good companies do? Acquire the poorly utilized assets and bend them to their philosphy and profit making formula. Once they become a good money making asset fold it in if looks core or sell it and acquire more? If they sell the good assets at a decent profit I do not have a problem with that. 

[BSdetector2016]

Yes it's bad, and it is being done at precisely the wrong time. Have a look at the LT chart of AltaGas and you will see what management fixation on a bad acquisition can do to a company. Time for Banskota to do his fiduciary duty and walk away from the Kentucky Power deal.

[Quintessential1]

Ok but it does not look like that is going to happen. You are either going to have to walk away from this stock or find an upside within it. Or short it,  Up to you.  You do you. Personally it is approaching my buy threshold.  GLTY and the longs here.

[BSdetector2016]

You can try to play seasonality but you had better be out before the dilution is announced. That's the problem with this one: the debt/dilution overhang, and a likely dividend cut. 

[Quintessential1]

"you had better be out before the dilution is announced." Again I believe a forward looking market has already baked in any dilution that has been forecasted into the existing share price. Good Luck and Happy Thanksgiving

[bttmfischer]

AQN seems to be unsure of what  their long term business plan should be. While the oil was over $100/ barrel, the so called "green energy" could be viable, but with WTI under $80? Definately not, even with tax payer subsidies. Now that WTI may become a $100/barrel commodity, AQN may recover, at least partially. I only have 2k of AQN(which I bought 4 yrs ago) thank God, so I really

[BSdetector2016]

"AQN seems to be unsure of what  their long term business plan should be." Those words are pretty much what SargeX was saying about AltaGas. Grab a garbage can before you look at the LT chart....

[SargeX]

Hey BS How she go? Back on Oct 26, 2021, I posted the note below. I still think this is a really bad purchase but also still think it is much different than ALA. Since the post. I have softened my view a bit and have decided to hang on to our full position. I think the debt will be much more manageable than what I initially thought. I also don't think AQN will cut their divy but who the heck

[TickerTwit]

The regulated side of the company acts as insulation against cash flow losses, but as you say, who the heck knows. Even regulated business can go sour with a radical change in government policy. .

[Capharnaum]

It's a myth that government policy change can make "regulated business" go sour. They might not see the anticipated growth and public share price may suffer, but the cashflows behind still represent the invested money. The negociation in price is due to the change in interest rates, which lowers the real return of the purchase and thus warrants a lower rate base multiple for the

[bttmfischer]

Capharnaum, you conveniently neglected to mention the carbon tax, which most certainly can and does effect the price of anything being made or transported. That tax BTW is going up on January 2023. Your statement of "(On the)Long term, AQN should profit from higher rates, since it should increase their rate base returns." is like wishful thinking, and it makes little economic sense in

[Capharnaum]

Huh, I'm not sure where to start. First, on the regulated portion, the rate base isn't affected by the carbon tax. Long term net revenue for regulated utilities is directly derived from the rate base. In general, regulated utilities are under "cost-of-service" regulation, where the rate base multiplied by the return rate becomes a cost of service and ensures that investors get a

[Quintessential1]

If you're looking for the bttmbngr to make sense you will be a while.   He regularly states obviously wrong facts and then lashes out when corrected like a scorned child. Yours will be forthcoming. I too would have pointed out that Kentucky power and carbon tax seems obviously oxymoronic but you know....scorned child.  I am not sure why I keep defending this stock as I haven

[BSdetector2016]

DOWN another 2.2% in the US. It just wont let up.