Altus Power (AMPS) AI Stock Analysis

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Altus Power

(NYSE:AMPS)

71Outperform

Altus Power shows strong revenue growth and improved profitability, supported by a successful earnings call. However, financial concerns persist with high leverage and negative free cash flow, while technical indicators suggest potential overbought conditions. Valuation remains moderate.

Positive Factors

Acquisition

AMPS announced it has entered into a definitive agreement to be acquired by TPG Inc. for $5.00 per share of its Class A common stock.

Financial Performance

AMPS reported 3Q24 results above expectations from a growing commercial & industrial solar project portfolio.

Negative Factors

Debt Levels

AMPS ended the quarter with $96.9M of unrestricted cash and $1,321.4M of debt for a trailing net debt-to-EBITDA ratio of 11.5x.

Stock Rating

The stock rating has been downgraded to Neutral.

Altus Power (AMPS) vs. S&P 500 (SPY)

Market Cap

$798.90M

Dividend YieldN/A

Average Volume (3M)2.29M

Price to Earnings (P/E)23.3

Beta (1Y)0.78

Revenue Growth26.49%

EPS GrowthN/A

CountryUS

Employees113

SectorUtilities

Sector Strength93

IndustryRenewable Utilities

Share Statistics

EPS (TTM)0.00

Shares Outstanding160,420,900

10 Day Avg. Volume2,680,651

30 Day Avg. Volume2,290,927

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)4.03

Price to Cash Flow (P/CF)9.90

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$5.00

Price Target Upside0.40% Upside

Rating ConsensusHold

Number of Analyst Covering6

Altus Power Business Overview & Revenue Model

Company DescriptionAltus Power, Inc. operates as a clean electrification company in the United States. It is involved in the on-site solar generation for commercial, industrial, and public customers; community solar; energy storage; and electric vehicle charging businesses. The company was founded in 2009 and is based in Stamford, Connecticut.

How the Company Makes MoneyAltus Power generates revenue primarily through the sale of electricity generated by its solar energy systems. The company enters into long-term power purchase agreements (PPAs) with its clients, ensuring a stable and predictable revenue stream. Additionally, Altus Power benefits from various government incentives and tax credits related to renewable energy deployment. The company also explores opportunities to expand its portfolio through strategic partnerships and acquisitions, enhancing its capacity to serve a broader customer base. Altus Power's business model is designed to capitalize on the increasing demand for sustainable energy solutions, leveraging its expertise in solar technology and project execution.

Altus Power Financial Statement Overview

Summary

Altus Power demonstrates strong revenue growth and improved profitability, transitioning from losses to a net profit. However, the balance sheet reveals high leverage, and negative free cash flow remains a concern, indicating financial stability challenges.

Income Statement

Positive

Altus Power shows strong revenue growth with a 26.5% increase from 2023 to 2024. The company also improved its profitability, turning a net loss in 2023 into a net profit in 2024, reflecting a net profit margin of 9.1%. However, the gross profit margin remains high at 100%, which is unusual and may require further investigation. EBIT and EBITDA margins have also improved, indicating better operational efficiency.

Balance Sheet

Positive

The balance sheet reflects a moderate financial structure with a debt-to-equity ratio of 0.84, showing a reasonable level of leverage. However, the equity ratio stands at 19.4%, indicating that the majority of the company's assets are financed by debt. Return on equity is relatively low at 3.9%, suggesting that the company is not generating substantial returns on shareholder investment.

Cash Flow

Neutral

The cash flow statement shows a concerning trend with free cash flow remaining negative, although it slightly improved compared to the previous year. The operating cash flow to net income ratio is 2.3, indicating strong cash generation relative to accounting profits. However, the free cash flow to net income ratio is negative, highlighting ongoing cash outflows exceeding cash inflows.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
196.26M	155.16M	101.16M	71.80M	45.28M
	Gross Profit
196.26M	125.53M	83.63M	57.77M	35.62M
	EBIT
29.56M	20.86M	84.84M	24.66M	12.53M
	EBITDA
141.70M	74.46M	108.61M	47.26M	24.20M
	Net Income Common Stockholders
17.82M	-9.36M	55.44M	13.01M	-1.89M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
104.90M	160.82M	193.02M	325.98M	33.83M
	Total Assets
2.35B	2.09B	1.38B	1.11B	581.56M
	Total Debt
382.70M	1.39B	762.72M	545.98M	389.14M
	Net Debt
277.80M	1.23B	569.70M	220.00M	355.31M
	Total Liabilities
1.81B	1.57B	913.83M	771.71M	424.25M
	Stockholders Equity
455.16M	447.08M	424.10M	304.92M	124.98M
Cash Flow		Free Cash Flow
-53.36M	-38.43M	-55.91M	-18.25M	-47.76M
	Operating Cash Flow
40.35M	79.36M	35.24M	23.70M	12.30M
	Investing Cash Flow
-367.20M	-586.81M	-163.21M	-223.25M	-171.34M
	Financing Cash Flow
231.32M	526.99M	-2.95M	491.66M	165.12M

Altus Power Technical Analysis

Technical Analysis Sentiment

Positive

Last Price4.98

Price Trends

50DMA

4.74

Positive

100DMA

4.33

Positive

200DMA

3.94

Positive

Market Momentum

MACD

0.06

Positive

RSI

64.58

Neutral

STOCH

50.00

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMPS, the sentiment is Positive. The current price of 4.98 is above the 20-day moving average (MA) of 4.94, above the 50-day MA of 4.74, and above the 200-day MA of 3.94, indicating a bullish trend. The MACD of 0.06 indicates Positive momentum. The RSI at 64.58 is Neutral, neither overbought nor oversold. The STOCH value of 50.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMPS.

Altus Power Risk Analysis

Altus Power disclosed 59 risk factors in its most recent earnings report. Altus Power reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Altus Power Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FSLR	75 Outperform	$13.78B	10.71	17.62%	―	26.75%	55.24%
NEE	72 Outperform	$137.74B	19.84	14.24%	3.15%	26.91%	-6.43%
AMPS	71 Outperform	$798.90M	23.35	0.29%	―	26.49%	―
Sector *	65 Neutral	$11.67B	15.52	6.23%	4.52%	5.50%	-9.06%
BE	59 Neutral	$3.83B	―	-5.49%	―	10.53%	90.76%
SEDG	51 Neutral	$864.69M	―	-116.01%	―	-68.86%	-4917.87%
RUN	46 Neutral	$1.58B	―	-73.12%	―	-9.83%	-71.44%

* Utilities Sector Average

Performance Comparison

AMPS

Altus Power

4.98

0.17

3.53%

FSLR

First Solar

130.05

-49.17

-27.44%

NEE

NextEra Energy

65.06

1.98

3.14%

SEDG

SolarEdge Technologies

13.35

-53.60

-80.06%

RUN

Sunrun

6.57

-5.31

-44.70%

Bloom Energy

16.60

4.93

42.25%

Altus Power Earnings Call Summary

Earnings Call Date: Mar 17, 2025 | % Change Since: 0.40% | Next Earnings Date: May 19, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong revenue growth, successful strategic initiatives, and significant expansion in the Community Solar portfolio. However, challenges such as interconnection delays and increased operating expenses were noted.

Highlights

Record Growth in Revenue and Kilowatt Hours

Altus Power generated 333 million kilowatt hours of clean electricity, resulting in $58.7 million of revenue, marking a 30% increase compared to the third quarter of 2023.

Significant Expansion in Community Solar Portfolio

Altus Power announced new Community Solar projects in Colorado and Maine, expanding to 9 states and close to 500% growth in customer base over two years.

Successful Tax Equity Transaction

Altus Power structured a new form of tax equity transaction, enhancing market efficiency and competitiveness in renewable energy project financing.

Strong Financial Performance

The company reported a GAAP net income of $8.6 million and an adjusted EBITDA of $37 million, a 27% increase compared to the third quarter of 2023.

1 Gigawatt Milestone

Altus Power surpassed 1 gigawatt of operating assets, enhancing operational efficiency and competitive edge in the commercial scale solar market.

Lowlights

Interconnection Delays

Continued delays in utility connections, particularly with the Morgan Stanley site, have been frustrating and have impacted project operational timelines.

Increased Operating Expenses

The quarter saw increased levels of operating and general administrative expenses, which partially offset the growth in revenue.

Company Guidance

During the Altus Power, Inc. third quarter 2024 earnings call, the company reaffirmed its confidence in achieving its 2024 guidance range of $196 million to $201 million in revenue and $111 million to $115 million in adjusted EBITDA. The company reported a significant 30% increase in revenue year-over-year, reaching $58.7 million due to growth in its portfolio and increased electricity sales. Adjusted EBITDA rose 27% to $37 million, driven by portfolio expansion despite higher operating expenses. Altus Power generated 333 million kilowatt hours of clean electricity during the quarter, and the net income was $8.6 million. The company also highlighted a 500% increase in its Community Solar customer base over the past two years, with approximately 30,000 customers across nine states. Altus Power's strategic focus on optimizing existing assets and a targeted market-specific approach to client engagement was noted as contributing to the company's momentum and anticipated growth.

Altus Power Corporate Events

Business Operations and StrategyFinancial Disclosures

Altus Power Reports Strong Q3 Growth in 2024

Positive

Nov 12, 2024

Altus Power, Inc. reported a strong third quarter in 2024, with revenues surging by 30% to $58.7 million and a notable increase in GAAP net income to $8.6 million. Their expansion in solar energy facilities contributed significantly to this growth, reflecting their leadership in the commercial solar sector. Furthermore, the company expanded its Community Solar subscriber base and surpassed 1 GW in operating assets, emphasizing its commitment to clean energy and addressing energy demands efficiently.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.