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Algonquin Power & Utilities

AQN-PA.TO
42
Renewable Utilities · Utilities
Price
C$26.27
+0.27 (+1.04%)
Market Cap
C$6.40B
Exchange
Toronto Stock Exchange
Winston Score
42
Winston looking serious
Winston is serious
Mixed quality — meaningful strengths and weaknesses.

Winston Score between 40 and 70. The stock passes some quality checks but not all.

Algonquin Power & Utilities Corp. is a Canadian company that provides electricity, natural gas, and water services to homes and businesses. It owns two main businesses: regulated utilities that deliver essential services to roughly 1.2 million customers across the United States and Canada, and a renewable energy division that generates power from wind, solar, and hydroelectric facilities. The company is one of North America's larger independent renewable energy producers.

Algonquin earns most of its money through regulated utility rates set by government agencies, which creates steady and predictable revenue. It also collects long-term contract payments from its renewable energy assets. The company operates primarily in the United States, with additional assets in Canada, Chile, and other countries. Its regulated utility business provides a degree of stability, but Algonquin carries a significant debt load, and rising interest rates have pressured its finances — making debt management and potential asset sales key factors to watch going forward.

Winston Score History

Score breakdown

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Quality

Gross Margin
70.8%
Premium pricing power — 70.8% gross margin
Operating Margin
20.6%
Excellent — 20.6% operating margin
ROCE
1.2%
Weak — 1.2% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY
-2.4%
Shrinking sales (-2.4% YoY)
EPS YoY
N/A
Data not available
EPS Consistency
6/8 quarters
Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion
331%
Turns 331% of profit into real cash
FCF Margin
-7.4%
Burning cash (-7.4%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity
1.41
Elevated debt (1.41)
Interest Cover
1.54x
Dangerous — barely covers interest (1.5x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio
26.3x
Growth-priced — P/E 26.3

P/E above the market average. People are paying up for expected growth.

P/E vs Forward
-34.0
SLOWING
Earnings expected to fall — forward P/E higher than today

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Dividends

Dividend Yield
4.30%
Healthy income — 4.30% yield

Generous yield. Worth checking whether the payout is sustainable.

Dividend Growth
+0.0%
Dividend flat

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