ALGONQUIN POWER & UTILITIES (AQN.CA) Stock Fundamental Analysis
TSX:AQN - Toronto Stock Exchange - CA0158571053 - Common Stock - Currency: CAD
We assign a fundamental rating of 3 out of 10 to AQN. AQN was compared to 21 industry peers in the Multi-Utilities industry. AQN has a medium profitability rating, but doesn't score so well on its financial health evaluation. AQN does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
AQN had positive earnings in the past year.
In the past year AQN had a positive cash flow from operations.
Of the past 5 years AQN 4 years were profitable.
Each year in the past 5 years AQN had a positive operating cash flow.
1.2 Ratios
The Return On Assets of AQN (-6.24%) is worse than 84.21% of its industry peers.
AQN has a worse Return On Equity (-22.90%) than 84.21% of its industry peers.
With a decent Return On Invested Capital value of 2.65%, AQN is doing good in the industry, outperforming 63.16% of the companies in the same industry.
AQN had an Average Return On Invested Capital over the past 3 years of 2.09%. This is in line with the industry average of 2.92%.
The 3 year average ROIC (2.09%) for AQN is below the current ROIC(2.65%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.24% | ||
| ROE | -22.9% | ||
| ROIC | 2.65% |
ROA(3y)0.13%
ROA(5y)2.2%
ROE(3y)0.18%
ROE(5y)5.78%
ROIC(3y)2.09%
ROIC(5y)2.23%
1.3 Margins
In the last couple of years the Profit Margin of AQN has declined.
AQN's Operating Margin of 19.49% is on the low side compared to the rest of the industry. AQN is outperformed by 84.21% of its industry peers.
In the last couple of years the Operating Margin of AQN has declined.
AQN has a Gross Margin (74.55%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of AQN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.49% | ||
| PM (TTM) | N/A | ||
| GM | 74.55% |
OM growth 3Y-6.79%
OM growth 5Y-4.27%
PM growth 3Y-74.64%
PM growth 5Y-41.23%
GM growth 3Y-1.6%
GM growth 5Y0.32%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AQN is destroying value.
Compared to 1 year ago, AQN has more shares outstanding
Compared to 5 years ago, AQN has more shares outstanding
Compared to 1 year ago, AQN has a worse debt to assets ratio.
2.2 Solvency
AQN has an Altman-Z score of 0.25. This is a bad value and indicates that AQN is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.25, AQN is doing worse than 94.74% of the companies in the same industry.
A Debt/Equity ratio of 1.49 is on the high side and indicates that AQN has dependencies on debt financing.
The Debt to Equity ratio of AQN (1.49) is better than 100.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.49 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.25 |
ROIC/WACC0.56
WACC4.76%
2.3 Liquidity
AQN has a Current Ratio of 0.92. This is a bad value and indicates that AQN is not financially healthy enough and could expect problems in meeting its short term obligations.
AQN has a Current ratio of 0.92. This is comparable to the rest of the industry: AQN outperforms 42.11% of its industry peers.
A Quick Ratio of 0.77 indicates that AQN may have some problems paying its short term obligations.
With a Quick ratio value of 0.77, AQN perfoms like the industry average, outperforming 42.11% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
The earnings per share for AQN have decreased strongly by -18.97% in the last year.
The Earnings Per Share has been decreasing by -4.95% on average over the past years.
AQN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.32%.
AQN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.35% yearly.
EPS 1Y (TTM)-18.97%
EPS 3Y-6.69%
EPS 5Y-4.95%
EPS Q2Q%-27.27%
Revenue 1Y (TTM)13.32%
Revenue growth 3Y17.17%
Revenue growth 5Y10.35%
Sales Q2Q%-8.24%
3.2 Future
The Earnings Per Share is expected to decrease by -4.45% on average over the next years.
AQN is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.28% yearly.
EPS Next Y-22.74%
EPS Next 2Y-23.03%
EPS Next 3Y-11.12%
EPS Next 5Y-4.45%
Revenue Next Year-4.55%
Revenue Next 2Y-4.94%
Revenue Next 3Y-2.09%
Revenue Next 5Y-0.28%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
AQN is valuated reasonably with a Price/Earnings ratio of 10.51.
Based on the Price/Earnings ratio, AQN is valued a bit cheaper than the industry average as 63.16% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 29.63. AQN is valued rather cheaply when compared to this.
AQN is valuated correctly with a Price/Forward Earnings ratio of 16.10.
AQN's Price/Forward Earnings ratio is in line with the industry average.
AQN is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.51 | ||
| Fwd PE | 16.1 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AQN indicates a slightly more expensive valuation: AQN is more expensive than 73.68% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 10.1 |
4.3 Compensation for Growth
A cheap valuation may be justified as AQN's earnings are expected to decrease with -11.12% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-23.03%
EPS Next 3Y-11.12%
5. Dividend
5.1 Amount
AQN has a Yearly Dividend Yield of 5.29%, which is a nice return.
Compared to an average industry Dividend Yield of 5.33, AQN has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, AQN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.29% |
5.2 History
The dividend of AQN has a limited annual growth rate of 4.94%.
AQN has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.94%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
AQN has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-28.84%
EPS Next 2Y-23.03%
EPS Next 3Y-11.12%
TSX:AQN (2/21/2025, 7:00:00 PM)
7.04
-0.03 (-0.42%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryMulti-Utilities
Earnings (Last)
Earnings (Next)
Inst Owners65.03%
Inst Owner ChangeN/A
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap5.40B
Analysts68.57
Price Target5.76 (-18.18%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.29% |
Yearly Dividend0.48
Dividend Growth(5Y)4.94%
DP-28.84%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.86%
Min EPS beat(2)-15.13%
Max EPS beat(2)13.41%
EPS beat(4)2
Avg EPS beat(4)-1.62%
Min EPS beat(4)-15.13%
Max EPS beat(4)13.41%
EPS beat(8)3
Avg EPS beat(8)-3.44%
EPS beat(12)4
Avg EPS beat(12)-5.16%
EPS beat(16)5
Avg EPS beat(16)-4.07%
Revenue beat(2)0
Avg Revenue beat(2)-2.63%
Min Revenue beat(2)-5.17%
Max Revenue beat(2)-0.08%
Revenue beat(4)1
Avg Revenue beat(4)-3.42%
Min Revenue beat(4)-9.57%
Max Revenue beat(4)1.13%
Revenue beat(8)4
Avg Revenue beat(8)-0.69%
Revenue beat(12)7
Avg Revenue beat(12)0.82%
Revenue beat(16)10
Avg Revenue beat(16)2.91%
PT rev (1m)-1.94%
PT rev (3m)-6.71%
EPS NQ rev (1m)3.23%
EPS NQ rev (3m)-44.56%
EPS NY rev (1m)2.52%
EPS NY rev (3m)-9.6%
Revenue NQ rev (1m)-12.03%
Revenue NQ rev (3m)-12.03%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.51 | ||
| Fwd PE | 16.1 | ||
| P/S | 1.21 | ||
| P/FCF | N/A | ||
| P/OCF | 6 | ||
| P/B | 0.79 | ||
| P/tB | 1.1 | ||
| EV/EBITDA | 10.1 |
EPS(TTM)0.67
EY9.52%
EPS(NY)0.44
Fwd EY6.21%
FCF(TTM)-0.55
FCFYN/A
OCF(TTM)1.17
OCFY16.67%
SpS5.81
BVpS8.96
TBVpS6.38
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.24% | ||
| ROE | -22.9% | ||
| ROCE | 3.69% | ||
| ROIC | 2.65% | ||
| ROICexc | 2.66% | ||
| ROICexgc | 2.91% | ||
| OM | 19.49% | ||
| PM (TTM) | N/A | ||
| GM | 74.55% | ||
| FCFM | N/A |
ROA(3y)0.13%
ROA(5y)2.2%
ROE(3y)0.18%
ROE(5y)5.78%
ROIC(3y)2.09%
ROIC(5y)2.23%
ROICexc(3y)2.1%
ROICexc(5y)2.25%
ROICexgc(3y)2.3%
ROICexgc(5y)2.48%
ROCE(3y)2.91%
ROCE(5y)3.1%
ROICexcg growth 3Y-2.44%
ROICexcg growth 5Y-7.49%
ROICexc growth 3Y-1.59%
ROICexc growth 5Y-6.9%
OM growth 3Y-6.79%
OM growth 5Y-4.27%
PM growth 3Y-74.64%
PM growth 5Y-41.23%
GM growth 3Y-1.6%
GM growth 5Y0.32%
F-Score6
Asset Turnover0.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.49 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 6.49 | ||
| Cap/Depr | 186.56% | ||
| Cap/Sales | 29.67% | ||
| Interest Coverage | 1.51 | ||
| Cash Conversion | 57.1% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.77 | ||
| Altman-Z | 0.25 |
F-Score6
WACC4.76%
ROIC/WACC0.56
Cap/Depr(3y)264.2%
Cap/Depr(5y)249.46%
Cap/Sales(3y)45.42%
Cap/Sales(5y)43.78%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-18.97%
EPS 3Y-6.69%
EPS 5Y-4.95%
EPS Q2Q%-27.27%
EPS Next Y-22.74%
EPS Next 2Y-23.03%
EPS Next 3Y-11.12%
EPS Next 5Y-4.45%
Revenue 1Y (TTM)13.32%
Revenue growth 3Y17.17%
Revenue growth 5Y10.35%
Sales Q2Q%-8.24%
Revenue Next Year-4.55%
Revenue Next 2Y-4.94%
Revenue Next 3Y-2.09%
Revenue Next 5Y-0.28%
EBIT growth 1Y21.37%
EBIT growth 3Y9.22%
EBIT growth 5Y5.64%
EBIT Next Year55.11%
EBIT Next 3Y12.57%
EBIT Next 5Y17.41%
FCF growth 1Y55.01%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y19.47%
OCF growth 3Y7.52%
OCF growth 5Y3.44%