5 TSX renewable energy stocks to watch in December

Highlights

• Northland Power’s operating income in Q3 2022 was C$ 216.46 million.
• Algonquin Power’s Q3 2022 revenue was reported at US$ 666.7 million.
• In Q3 2022, Innergex reported net earnings at C$ 20.98 million.

Renewable energy forms a crucial part of the Canadian economy. With a focus to save natural resources, the sector is evolving on a continuous basis. The renewable energy sector aims at using environmentally friendly ways that do not contribute to the depletion of existing natural resources. Further, with the increased impact of carbon on the environment, the sector is witnessing a change in the overall approach. Most companies in the sector are working on implementing innovative ways that ultimately will lead to lesser carbon emissions.

With every positive, there are potential downsides too. Hence, investors need to look at the other side and make an informed decision. Check with the overall factors before investing in your stocks.

Here are five renewable energy stocks mentioned along with their recent financial highlights: 

1. Northland Power Inc. (TSX:NPI)

Northland Power Inc. has a total market capitalization of C$ 9191.97 million and is engaged in developing, maintaining, and constructing infrastructure assets with green and clean technologies. Green energy includes solar and wind (offshore and onshore).

In Q3 2022, Northland Power’s operating income was reported at C$ 216.46 million from C$ 89.01 million in the year-ago quarter. For the same period, the sales increased to C$ 555.85 million from C$ 432.07 million.

The company’s gross profit rose to C$ 484.1 million from C$ 383.44 million. The net income was noted at C$ 76.08 million versus a net loss of C$ 4.66 million for the reported quarter.

Meanwhile, the adjusted EBITDA grew to C$ 289.76 million from C$ 210.66 million. The cash provided by operating activities jumped to C$ 523.33 million from C$ 280.39 million. For the same period, the dividends declared by the company were posted at C$ 71.95 million from C$ 67.81 million.

Northland Power authorized a monthly dividend of C$ 0.1 and posted a dividend yield of 3.203 per cent. The company’s EPS is C$ 2.79.

2. Algonquin Power & Utilities Corp. (TSX:AQN)

Algonquin Power & Utilities Corp is into generation of distribution and transmission utility with a total market capitalization of US$ 6884.98 million. With its transmission and electric generation utility investment, the company provides safe, cost-effective, and sustainable water and energy solutions. 

Algonquin Power’s revenue in Q3 2022 was reported at US$ 666.7 million compared to US$ 528.6 million. The company’s adjusted EBITDA increased to US$ 276.1 million from US$ 252 million for the same period. The adjusted funds flow from operations rose to US$ 205.5 million from US$ 170.2 million.

The adjusted net earnings decreased to US$ 73.5 million from US$ 97.6 million for the reported quarter. With a dividend yield of 9.432 per cent, the company paid a quarterly dividend per share of US$ 0.181. Algonquin Power’s three-year dividend growth was posted at 8.65 per cent.

3. Brookfield Renewable Partners L.P. (TSX: BEP.UN)

Brookfield Renewable partners L.P. is into clean energy assets with a total market capitalization of US$ 10590.28 million. The company has a presence in South and North America with portfolio-solar, hydroelectric, and wind storage facilities.

In Q3 2022, the company’s revenue increased to US$ 1,105 million from US$ 966 million in the year-ago quarter. The cash from operating activities was reported at US$ 427 million compared to US$ 345 million for the same period. Brookfield’s cash and cash equivalents grew to US$ 846 million from US$ 537 million.

As on September 30, 2022, the total assets soared to US$ 57,388 million from US$ 55,867 million on December 31, 2021. Meanwhile, the liabilities decreased to US$ 5,926 million from US$ 6,215 million for the same comparable period.

Brookfield distributed a quarterly dividend per share of US$ 0.32 to its shareholders.

Market Capitalization of NPI, AQN, BEP.UN, INE and RNW:

4. Innergex Renewable Energy Inc. (TSX:INE)

Innergex Renewable Energy Inc. is a power producer that is engaged in operating and acquiring solar, wind and hydroelectric facilities. The C$ 3425.34 million market capitalization company has a presence in Chile, France, Canada, and the US.

In Q3 2022, Innergex reported its revenue at C$ 258.38 million compared to C$ 184.56 million in the year-ago quarter. The net earnings increased to C$ 20.98 million from a net loss of C$ 23.46 million for the same comparable period.

The company distributed a quarterly dividend of C$ 0.18 per share and noted a dividend yield of 4.291 per cent.

On October 4, 2022, Innergex completed its acquisition of the remaining 16 assets of the wind portfolio in France.

5. TransAlta Renewables Inc. (TSX:RNW)

TransAlta Renewables Inc. operates as an electric utility with transmission and generation facilities. The total C$ 3824.15 million market capitalization company has the following segments- Canadian Wind and Hydro, Australian and US gas.

In Q3 2022, TransAlta Renewables noted its revenue at C$ 124 million compared to C$ 114 million in Q3 2021. The adjusted EBITDA decreased to C$ 88 million from C$ 102 million for the same comparable period. On the other hand, the free cash flow also declined to C$ 58 million from C$ 64 million. The company’s dividend declared remained unchanged at C$ 0.23.

TransAlta Renewables paid a monthly dividend of C$ 0.078 per share and reported its dividend yield at 6.559 per cent.

Bottom Line

While selecting your stocks, look at the overall picture and make sure to check every factor. At the same time also analyze the company’s financial ratios and valuations. Your portfolio must be aligned with your investment strategy to get the desired results. Hence, operate with a pragmatic approach and keep an eye on the changing factors.

If you are investing in the market, have a wide perspective along with a rational approach. The sector is growing but may give different results at different times. With every move, reposition your portfolio to avoid any risk. Further, move ahead with a diversification strategy. This helps to spread out any risk and keeps you relevant in the long term.

Please note, the above content constitutes a very preliminary observation based on the industry and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.