Canaccord Genuity Sticks to Its Buy Rating for Capital Power

By Jason Carr

The Utilities sector company, Capital Power (TSX: CPX), has received a rating update from a Wall Street analyst today. The company received a Buy rating from Canaccord Genuity’s analyst David Galison, with a C$28 price target.

Galison commented:

“We are initiating coverage of Capital Power Corp. with a BUY rating and a 12-month price target of C$28.00. Our target represents a total return of 22.1% including a 2018E dividend of C$1.67 per share. Our positive outlook reflects improving earnings visibility and reduced volatility from the company’s asset base as management diversifies away from carbon-emitting technologies and the Alberta power market. CPX is also focused on reducing exposure to merchant power markets as well as continued recontracting discussions at facilities that have nearer-term contract expires. Investment Highlights 2018 Outlook: Guidance for 2018E assumes a 22.5% year-over-year increase in EBITDA (adjusted) and a 4.7% increase in AFFO. While AFFO growth is positively impacted by recent acquisitions and improving power prices in Alberta, growth is offset partially by the recent C$30/tonne carbon tax in Alberta.”

According to TipRanks.com, Galison is ranked #1317 out of 4773 analysts.

Currently, the analyst consensus on Capital Power is Strong Buy and the average price target is C$28, representing an 11.9% upside.

In a report issued on April 30, CIBC also reiterated a Buy rating on the stock with a C$28 price target.

The company has a one-year high of C$26.51 and a one-year low of C$22.15. Currently, Capital Power has an average volume of 205.4K.

Capital Power Corp. engages in the development, acquisition, construction, operation, and optimization of power generation facilities. Its projects include Halkirk, Port Dover and Nanticoke, Keephills 3, and K2 wind power. The company was founded on May 1, 2009 and is headquartered in Edmonton, Canada.

The company’s shares closed on Thursday at C$25.02.