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Companhia Paranaense de Energia Pfd (ELP)
NYSE:ELP
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Companhia Paranaense de Energia Pfd
(NYSE:ELP)
77Outperform
Positive Factors
Asset Rotation
Copel announced a positive asset rotation involving the Baixo Iguaçu Hydropower Plant, which adds ~1% NPV to the base-case valuation and could potentially result in additional dividends.
Dividend Policy
Copel announced an additional R$1.3bn dividends related to FY24 results, leading to a 4.3% dividend yield and an 86% total payout FY24.
Real Estate Asset Sales
Copel announced R$264mn real estate asset sales, which could translate into additional dividends.
Negative Factors
Earnings Expectations
Soft GenCo results were partially offset by a good cost-control in the quarter as a result of the ongoing post-privatization turnaround.
Operational Results
Copel reported slightly below estimates 4Q24 operational results with adj. EBITDA at R$1.3bn, down 13% YoY and 5% below BofAe and BBG Consensus.
Companhia Paranaense de Energia Pfd (ELP) vs. S&P 500 (SPY)
Market Cap
$5.23B
Dividend Yield3.02%
Average Volume (3M)252.01K
Price to Earnings (P/E)2.3
Beta (1Y)0.47
Revenue Growth-4.45%
EPS GrowthN/A
CountryUS
Employees4,396
SectorUtilities
Sector Strength81
IndustryDiversified Utilities
Share Statistics
EPS (TTM)3.15
Shares Outstanding335,867,070
10 Day Avg. Volume200,743
30 Day Avg. Volume252,010
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.64
Price to Cash Flow (P/CF)N/A
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
$12.00Price Target Upside61.51% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Companhia Paranaense de Energia Pfd Business Overview & Revenue Model
Company DescriptionCompanhia Paranaense de Energia - COPEL engages in the generation, transformation, distribution, and trading of energy to industrial, residential, commercial, rural, and other customers primarily in the State of Paraná, Brazil. The company operates through Power generation and transmission, Power distribution, Gas, and Power sale segments. It is also involved in the piped natural gas distribution. As of December 31, 2021, the company operated 20 hydroelectric plants, 30 wind plants, and 1 thermoelectric plant with a total installed capacity of 5,957 megawatts; and owned and operated 3,638 km of transmission lines and 204,957 km of distribution lines. It holds concessions to distribute electricity in 394 municipalities in the State of Paraná and in the municipality of Porto União in the State of Santa Catarina. Companhia Paranaense de Energia COPEL was founded in 1954 and is headquartered in Curitiba, Brazil.
How the Company Makes MoneyCopel generates revenue primarily through its electricity operations, which include the generation, transmission, and distribution of electricity. The company owns and operates a portfolio of hydroelectric and thermoelectric plants that produce electricity, which is then transmitted through its network of power lines to residential, commercial, and industrial customers. Revenue is earned from the sale of electricity to these customers under regulated tariffs set by the Brazilian government. Additionally, Copel's telecommunications arm contributes to its revenue by providing internet and communication services. This diversification allows Copel to leverage its infrastructure and expertise in the energy sector while exploring growth opportunities in other areas, thereby enhancing its revenue streams.
Companhia Paranaense de Energia Pfd Financial Statement Overview
Summary
The company exhibits solid financial performance with consistent revenue growth and improving profitability. However, increasing debt levels and high capital expenditures warrant cautious monitoring to maintain liquidity.Income Statement
The company exhibits a solid income statement with a consistent revenue growth trend, highlighted by a 5.5% increase in revenue from 2023 to 2024. Gross profit margin has been stable, and net profit margin improved to 12.4% in 2024. However, there was a slight decline in gross profit margin due to increased costs, and the EBIT margin is at 17.9%, indicating room for enhancing operational efficiency.75
Positive
Balance Sheet
The balance sheet reflects a healthy equity position with an equity ratio of 44.7% in 2024. Debt-to-equity ratio stands at 0.68, which is manageable, but there is an upward trend in total debt. Return on equity improved to 10.9%, showing better profitability. The company should monitor its leverage closely to mitigate potential risks.68
Positive
Cash Flow
Cash flow analysis shows a strong free cash flow generation, despite a marginal decrease in free cash flow from the previous year. Operating cash flow to net income ratio is healthy at 1.21, indicating efficient cash generation from operations. However, significant investing cash outflows suggest high capital expenditure, which should be managed to maintain liquidity.72
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 22.65B | 21.48B | 21.93B | 23.98B | 18.63B |
| Gross Profit | ||||
| 4.07B | 5.75B | 5.00B | 4.86B | 4.06B |
| EBIT | ||||
| 4.06B | 2.49B | 987.75M | 3.59B | 5.12B |
| EBITDA | ||||
| 5.17B | 3.96B | 2.55B | 6.77B | 6.61B |
| Net Income Common Stockholders | ||||
| 2.81B | 2.26B | 1.11B | 3.86B | 3.90B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 4.16B | 5.65B | 2.68B | 3.49B | 3.22B |
| Total Assets | ||||
| 57.38B | 55.82B | 49.70B | 49.54B | 46.78B |
| Total Debt | ||||
| 17.57B | 15.23B | 12.66B | 11.99B | 10.04B |
| Net Debt | ||||
| 13.41B | 9.60B | 9.98B | 8.52B | 6.82B |
| Total Liabilities | ||||
| 31.75B | 31.63B | 28.57B | 27.36B | 26.53B |
| Stockholders Equity | ||||
| 25.67B | 23.89B | 20.82B | 21.84B | 19.96B |
| Cash Flow | Free Cash Flow | |||
| 3.26B | 3.30B | 2.95B | 3.04B | 3.77B |
| Operating Cash Flow | ||||
| 3.39B | 3.52B | 3.90B | 3.39B | 4.02B |
| Investing Cash Flow | ||||
| -5.74B | -3.14B | -2.77B | 31.91M | -1.67B |
| Financing Cash Flow | ||||
| 803.86M | 2.70B | -1.92B | -2.88B | -1.79B |
Companhia Paranaense de Energia Pfd Technical Analysis
Positive
7.43
Price Trends
6.92
Positive
6.56
Positive
6.81
Positive
Market Momentum
0.15
Positive
62.93
Neutral
40.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ELP, the sentiment is Positive. The current price of 7.43 is above the 20-day moving average (MA) of 7.16, above the 50-day MA of 6.92, and above the 200-day MA of 6.81, indicating a bullish trend. The MACD of 0.15 indicates Positive momentum. The RSI at 62.93 is Neutral, neither overbought nor oversold. The STOCH value of 40.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ELP.
Companhia Paranaense de Energia Pfd Risk Analysis
Companhia Paranaense de Energia Pfd disclosed 49 risk factors in its most recent earnings report. Companhia Paranaense de Energia Pfd 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
Companhia Paranaense de Energia Pfd Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $94.77B | 21.46 | 9.10% | 3.41% | 4.46% | 54.09% | |
77 Outperform | $100.85B | 23.02 | 13.61% | 3.13% | 5.83% | 10.23% | |
77 Outperform | $5.23B | 2.29 | 9.47% | 3.02% | -4.45% | ― | |
74 Outperform | $39.05B | 21.10 | 8.44% | 3.02% | 4.23% | -27.02% | |
73 Outperform | $58.35B | 19.57 | 11.37% | 3.31% | 2.76% | 31.53% | |
72 Outperform | $145.82B | 21.02 | 14.24% | 2.98% | 26.91% | -6.43% | |
65 Neutral | $12.17B | 16.15 | 5.32% | 4.37% | 5.50% | -9.06% |
* Utilities Sector Average
Performance Comparison
ELP
Companhia Paranaense de Energia Pfd
7.43
0.03
0.41%
AEP
American Electric Power
108.37
27.17
33.46%
ED
Consolidated Edison
110.06
23.20
26.71%
DUK
Duke Energy Corp
121.07
28.67
31.03%
NEE
NextEra Energy
70.92
10.08
16.57%
SO
Southern Co
91.82
23.22
33.85%
Companhia Paranaense de Energia Pfd Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: 7.06% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Positive
The earnings call showcased a strong financial performance with significant dividends and strategic asset optimization. While there were challenges related to wind asset performance and trading, the company maintains a positive outlook with a focus on long-term growth and operational excellence.Highlights
Strong Financial Performance
Copel reported a fourth-quarter adjusted EBITDA of BRL1.3 billion and net income of almost BRL600 million. For the full year, adjusted EBITDA reached BRL5.1 billion with net income of BRL2.8 billion.
Significant Dividend Proposal
Copel proposed a robust dividend payout for 2024, with a total of BRL2.3 billion, representing a payout ratio of 86% and a dividend yield of approximately 8.4%.
Copel Distribuicao's Record Efficiency
Copel Distribuicao achieved a 23.6% increase in EBITDA in Q4 2024 compared to the previous year, with efficiency reaching almost 46% above the regulatory EBITDA.
Asset Optimization and Value Creation
Copel completed several strategic moves including an asset swap with Eletrobras, the sale of small hydropower generation assets for BRL450 million, and the sale of Baixo Iguacu for BRL570 million.
Long-Term Strategy and Investment Plans
The company maintained a focus on operational excellence, capital allocation, and a consistent energy trading strategy, aiming for significant future growth and efficiency.
Lowlights
Impact of Wind Asset Performance
The performance of wind complexes was negatively affected by curtailment and unavailability, leading to a BRL93 million impact. Curtailment was at 13.1% in Q4 2024 compared to 8.3% in Q4 2023.
Trading Challenges
Copel experienced a negative EBITDA of BRL15 million in trading for Q4 2024, primarily due to lower trading margins and price variations in submarkets.
Increased Leverage Due to Grant Bonus Payment
Leverage increased to 2.6 times net debt over EBITDA due to the grant bonus payment for the renewal of power generation plants, though it remains below the 3.5 times covenant limit.
Company Guidance
In the earnings call for the fourth quarter of 2024, Companhia Paranaense de Energia (Copel) reported sound financial results, highlighting an adjusted EBITDA of BRL1.3 billion and a net income of approximately BRL600 million for the quarter. For the entire year, the adjusted EBITDA reached BRL5.1 billion, with a net income of BRL2.8 billion. Despite challenges such as curtailment and the temporary unavailability of some wind turbines, Copel Distribution significantly contributed to these results, achieving an EBITDA efficiency almost 46% above the regulatory level. The company proposed robust dividends totaling BRL2.3 billion for the year, reflecting a payout ratio of 86% and a dividend yield of approximately 8.4%. Copel's strategy included noteworthy asset swaps and sales, such as the asset swap with Eletrobras and the sale of its stake in Baixo Iguacu for BRL570 million, indicating a disciplined approach to capital allocation. The company also emphasized its ongoing efforts to optimize operations, improve asset management, and capitalize on opportunities in energy trading, while maintaining strict cost controls and a strong focus on sustainable growth.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.