Watch these utilities stocks as the sector exceeds market performance - Kalkine Media

November 16, 2023 06:09 AM EST | By Akanksha Vashisht
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Summary

  • The S&P/TSX Capped Energy index rose by 1.22% on Wednesday, higher than S&P/TSX Composite’s intraday gains of 0.17% on the day.
  • Northland Power, a sustainable infrastructure provider, rose 2.78% intraday at Wednesday’s market close.
  • AltaGas Ltd., an energy infrastructure enterprise manager, saw an intraday price increase of 1.47% on Wednesday.

On Wednesday, November 15, 2023, the S&P/TSX Capped Utility index rose 1.22% intraday. Meanwhile, the broader S&P/TSX Composite index ended trade marginally higher by 0.17% on Wednesday.

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Two utility sector stocks that outperformed the market include Northland Power Inc. and AltaGas Ltd. Here is a closer examination of these stocks.

Northland Power Inc. (TSX: NPI)

Northland Power engages in the development, building, and management of sustainable infrastructure assets with technologies like offshore and onshore wind, solar power, and delivering energy through a regulated utility.

Revenue dropped to CAD 513 million in Q3 2023, as against CAD 556 million in the same period in 2022. For the September quarter, gross profit declined to CAD 458 million from CAD 484 million in the previous corresponding period.

EBITDA (adjusted) fell to CAD 267 million in Q3 2023 from CAD 290 million in Q3 2022. Adjusted Free Cash Flow per share decreased to CAD 0.25 in Q3 2023. Meanwhile, net income decreased to CAD 43 million in Q3 2023 from CAD 76 million in Q3 2022. The company recently announced the signing of credit agreements for CAD 5 billion and CAD 5.2 billion at Hai Long Offshore Wind Project and Baltic Power Offshore Project Wind Project, respectively. 

NPI Price Chart; Powered By: TradingView

Based on Wednesday’s closing price of CAD 22.53, NPI has a P/E ratio of 14.23x and a dividend yield of 5.33%. As at Wednesday’s market close, NPI stock price rose 2.78% intraday and fell ~40% on a YTD basis.

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AltaGas Ltd. (TSX: ALA)

AltaGas Ltd possesses and manages a diverse array of energy infrastructure enterprises. Its utility division oversees and manages natural gas distribution assets across North America.

In Q3 2023, Normalized EBITDA stood at CAD 252 million, a rise from CAD 233 million in Q3 2022, whereas the loss before income taxes amounted to CAD 51 million in Q3 2023 in contrast to an income before income taxes of CAD 48 million during the same quarter in 2022.

Normalized EPS remained at CAD 0.10 in Q3 2023 compared to CAD 0.10 in Q3 2022, while GAAP EPS indicated a loss of CAD 0.18 in Q3 2023 as opposed to a loss of CAD 0.17 in Q3 2022.

The company will be paying common share holders a dividend of CAD 0.28 on December 29, 2023.

ALA Price Chart; Powered By: TradingView

Based on Wednesday's closing price of CAD 27.61, ALA has a P/E ratio of 13.25x and a dividend yield of 4.06%. As at Wednesday’s market close, ALA stock price rose 1.47% intraday and by ~17.5% YTD.

 

 


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