Capital Power is heading towards $30.
Capital Power released it's second quarter results and it was a "doozy".However the market reacted strangely.First the stock price went to about $25.50 then fell back quickly to around $24.50 and now has started to march towards $26.00.But once investors realize that this report was chocked full of stuff they should send it at least to $28 which is it's 2 year high.That, at least, is what this blog is calling for.
The Second Quarter Report
Capital Power announced at the outset of the report that net income was $109 million and e.p.s of $1.09 per share compared to $23 million and $.19 per share for the same quarter in 2016.Furthermore for six months net income was $159 million and earnings of $1.47 per share compared to $17 million and $.07 per share in 2016.While adjusted funds from operations were $138 million compared to $172 million for 2016.
Capital Power has added new generation capacity also.It added 1300 MW of generating capacity in 2017.It acquired Veresen's 284 MW thermal power business and the 795 MW Decatur Energy centre and started commercial operations of it's Bloom Wind project in Kansas.And perhaps most importantly Capital Power tells us that they captured an average Alberta power price of $52 per megawatt hour compared to the average spot price of $19 per megawatt hour.They also announced that they had an exclusive agreement with the Siksika Nation reserve to develop wind,solar and natural gas projects.
A Healthy Dividend
Utility stock's prices, more than most,are based on the yieldA mature utility stock (like Capital Power) usually yields 3.5 to 4.6% while Emera yields 4.5%.At it's present stock price Capital Power yields a whopping 6.7% and it's earnings growth potential is as good as all except Emera.If CPX yields the 4.5 to 5% which it normally does the price would be between $30 and $34 per share.It just had a large dividend increase and will likely take some time to find it's equilibrium.But this blog renews it's call to hit $28 fairly soon. use Blogdaleupsome for analysis of Cdn. utilities ;use Blogdaleupsome to pick winning stocks
The Second Quarter Report
Capital Power announced at the outset of the report that net income was $109 million and e.p.s of $1.09 per share compared to $23 million and $.19 per share for the same quarter in 2016.Furthermore for six months net income was $159 million and earnings of $1.47 per share compared to $17 million and $.07 per share in 2016.While adjusted funds from operations were $138 million compared to $172 million for 2016.
Capital Power has added new generation capacity also.It added 1300 MW of generating capacity in 2017.It acquired Veresen's 284 MW thermal power business and the 795 MW Decatur Energy centre and started commercial operations of it's Bloom Wind project in Kansas.And perhaps most importantly Capital Power tells us that they captured an average Alberta power price of $52 per megawatt hour compared to the average spot price of $19 per megawatt hour.They also announced that they had an exclusive agreement with the Siksika Nation reserve to develop wind,solar and natural gas projects.
A Healthy Dividend
Utility stock's prices, more than most,are based on the yieldA mature utility stock (like Capital Power) usually yields 3.5 to 4.6% while Emera yields 4.5%.At it's present stock price Capital Power yields a whopping 6.7% and it's earnings growth potential is as good as all except Emera.If CPX yields the 4.5 to 5% which it normally does the price would be between $30 and $34 per share.It just had a large dividend increase and will likely take some time to find it's equilibrium.But this blog renews it's call to hit $28 fairly soon. use Blogdaleupsome for analysis of Cdn. utilities ;use Blogdaleupsome to pick winning stocks
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