In an era when the world is struggling with global warming and staggering levels of pollution, April 22 is observed as Earth Day to remind humans to protect the one planet we have for survival. So on this occasion, it might be a good idea to delve into some green energy stocks such as TransAlta Renewables Inc (TSX:RNW), Capital Power Corporation (TSX:CPX) and Boralex Inc (TSX:BLX).
In Federal Budget 2021 revealed on April 19, the Trudeau government pledged for a “sustainable” economy with an additional C$ 5 billion package targeted at green initiatives over the next seven years. The plan, Finance Minister Chrystia Freeland pointed, is to accelerate Canada’s efforts to achieve its net-zero emissions target by 2050.
In the light of the federal budget’s focus on green initiatives and the event of Earth Day, let’s explore the profiles of these three Canadian green stocks that are currently trending high on the Toronto Stock Exchange.
1. TransAlta Renewables Inc (TSX:RNW)
TransAlta Renewables, which owns and operates facilities that generate and transmit green power, has a market cap of C$ 5.3 billion on TMX. The energy stock shed about eight per cent year-to-date (YTD), it still holds a one-year growth of nearly 42 per cent.
It secured a 52-week high of C$ 24.42 on January 7 this year, and currently holds a share value of C$ 19.95.
1-year chart of stock performance of TransAlta Renewables (Source: Refinitiv/Thomson Reuters)
TransAlta Renewables reflects a price-to-earnings (P/E) ratio of 57.9 while its return on equity (ROE) stands at 3.94 per cent on TMX.
Dividend-wise, the renewable energy company pays C$ 0.078 apiece to its shareholders on a monthly basis, and currently holds an yield of 4.712 per cent, as per TMX data.
In 2020, TransAlta’s comparable EBITDA climbed five per cent year-over-year (YoY) to C$ 462 million, while its adjusted funds from operations were up three per cent YoY to C$ 355 million.
2. Capital Power Corporation (TSX:CPX)
Capital Power owns and runs a collection of energy generating facilities, including those that produce renewable power. Currently posting a market cap of C$ 4.1 billion on TMX, the Edmonton-based company has a notable P/E ratio of 47.7 and an ROE of 2.66 per cent.
The energy stock has expanded by nearly 47 per cent over the past year and holds a growth of over 10 per cent YTD. It also hit a fresh 52-week high of C$ 38.63 on Wednesday, April 21, surpassing its previous one-year high of C$ 38.35 (April 14) by 0.63 per cent.
1-year chart of stock performance of Capital Power (Source: Refinitiv/Thomson Reuters)
As investors often seek out stocks that pay dividends, note that Capital Power distributes a quarterly dividend of C$ 0.512 that presently holds a dividend yield of 5.312 per cent on TMX.
The Canadian power producer posted a net income of C$ 130 million in 2020, up from C$ 119 million in 2019.
3. Boralex Inc (TSX:BLX)
Currently ranked high among TSX-listed price performers, Boralex stocks register a P/E ratio of 74.2 and an ROE of 5.78 per cent on TMX. It also accumulated a share trading volume of 1.2 million over the last month.
While Boralex scrip dwindled by over nine per cent YTD, it still holds a substantial one-year growth of nearly 64 per cent. The stock also ballooned by almost 15 per cent in the last one month.
1-year chart of stock performance of Boralex Inc (Source: Refinitiv/Thomson Reuters)
Boralex saw its combined EBITDA(A) jump four per cent YoY to C$ 513 million in 2020. Its cash flow, on the other hand, amounted to C$ 146 million in 2020, reflecting a 22 per cent YoY increase.
The electric utility company pays a quarterly dividend of C$ 0.165 and, as per TMX, holds a dividend yield of 1.542 per cent.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.