Algonquin Power & Utilities Corp T.AQN

Don't Just Sell This POS

[starboy101]

Sell all renewable energy P'sOS !

You know when I look around the renewable energy room what I see are a bunch of pale face, sickly looking, P'sOS !

I see Polaris PIF setting a new 52wk low today.

I see Brookfield BEP within pennies of setting a new 52wk low. Makes me wonder how they can promise to increase the dividend yearly when they seem to never make money. I guess having the deep pockets of Brookfield behind them is their saving grace.

I see Northland NPI trading within a few dollars of a new 52week low. At least they didn't go down the path of paying a fat dividend in order to attract investors. Might be their only saving grace.

I see Transalta RNW again within a few dollars of setting a new 52wk low.

I see Capital Power CPX trading at a 45 P/E with a sickly 10 year avg ROE of 3.5. Makes me wonder how they can trade at such a ridiiculous multiple when they have such a pathetic ROE.

One mans opinion of course take it all with a grain of salt and make your own decisions. As far as myself ...in my books.....renewable energy=POS.

[Chefboy69]

same thing happened with OIL sector..only the other way in 2021 no one wanted oil stocks.... YOu could have bought stocks for 1/10th their share price of today

[jx7000]

Yup, bought a whole wack of Cardinal Energy (around a dollar and below) and then Suncor call options while in the mid $20s. I've paid my dues over the years and learned to do my own D.D. My nerve wracking but successful outcome from holding Home Cap Group in 2017 (when it was being shorted) was my steep learning curve. People are going to need fossil fuels for decades to come, and it will only

[marcrobert]

not just renewables, all utilities are looking at higher capital costs . but if they have no debt to refinance any time soon, and don't need more capital for a year or 2, who cares? reits, utes, homebuilders, interest sensitive sectors will bottom sometime next year potentially, some strategists think 1st half but who knows. When fed hits 5-6% = bigger discounts and more opportunity etc. If

[Chefboy69]

you are assuming we see lowering of rates in the next 2 years?  I don't think so...We are in a high interest rate enviorment for a long while... In 1979 we had 12% rates rates did not come down 1985-1986..then went back up in the 1998-199 rates did not drop until 1992 that is 11 years.. here you go...https://www150.statcan.gc.ca/n1/pub/11-210-x/2010000/t098-eng.htm

[marcrobert]

This is not the 70s. they didn't have the tools, the computers or the same knowledge. i doubt the fed pivot will be in more than 2 years from now. economy depends on cheap , like an IV for a patient. Economic models are a lot more sophisticated to avoid huge swings, but money printing still does need to be reigned in. this is one of the first cycles in my view of extended currency dilution

[Chefboy69]

nope...dead wrong...the IV of FREE credit has been stemmed..and will not be back for many years... PAY off your debts bro...good luck and i am sorry for those that lost here

[Capharnaum]

100% of the cost of the debt tied to the utilities gets passed into rates (in other words, the customers support the full cost of the interests related to the utilities), and 70% of the debt of AQN is tied to utilities, so the investors exposure to interest rates is limited.

[pennydredful]

THere   may  be  a  lag  before  those  higher   rates can be passed  on   re   making   an  application  to   a  regularitory    board   who  would   approve     months later   ? 

[AlwaysLong683]

ff that's the case I'm assuming AQN has no need to cut the dividend.....? If they do cut the dividend, they messed up somwhere as most investors in utility stocks do so for the dividend income and management knows this unless they have no idea who the bulk of their investors are. There is no guarantee that utilities recoup 100% of their costs. If a utility wants to increase rates, they

[Capharnaum]

Well, I've reviewed and presented many cases for rate increases. Usually, utilities get their costs approved ahead of submitting them. For example, the capital structure always has been looked at and approved (which includes cost of debt), and those costs can't be denied later on. From my experience and considering the surveys and all the expert reports on rate reviews for a broad number

[splurge]

Thanks for your insight Capharnaum. Much appreciated. How are you on financials?  Perhaps you could help me understand some items on their cahflow statement as I have not seen this before perhaps as they report in US. Note 20 on their finanacials Q3 breaksdown the supposedly "Non cash items" in working capital. The largest item is $57.7 mln Q3 and $112 mln YTD 2022. YTD last year

[Capharnaum]

You can find the list of of regulatory assets and liabilities in note 5. It's basically revenue or costs that are recognized by the regulator but will be put into rates later on. So, they are part of the earnings but the cash will flow later on. The net amount of regulatory assets would be part of the rate base and accrue interests at the average cost of capital. There are mainly two ways for

[splurge]

Thanks for that explanation. To be clear a negative adjustment on their cash flow statement then means the cash flow is deferred on that portion relating to regulatory assets. Interesting how it is added back to boost AFFO. Trying to determine normalized cash flow is becoming somewhat elusive. Cheers Thanks