Northland Power (NPIFF) AI Stock Analysis

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Positive Factors

Financial Outlook

EBITDA growth is expected to accelerate next year with new projects coming online and a permanent CEO appointment anticipated soon.

Growth Opportunities

NPI is uniquely positioned to capitalize on the significant growth expected in the offshore wind market.

Valuation

Analyst rates NPI shares Outperform due to the under-appreciated growth pipeline and attractive relative valuation.

Negative Factors

Financial Performance

NPI reported Q3/24 adjusted EBITDA below expectations, primarily due to issues in Offshore Wind and Natural Gas performance.

Market Perception

Given the ~7% adj. EBITDA miss and less positive directional tone on the 2024 guide, shares could trade heavy in the near term.

Performance Issues

Lower offshore wind speeds and curtailments at the German offshore wind facilities have led to reduced 4Q estimates.

Northland Power (NPIFF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.96B

Dividend Yield5.74%

Average Volume (3M)63.88K

Price to Earnings (P/E)21.2

Beta (1Y)0.80

Revenue GrowthN/A

EPS GrowthN/A

CountryUS

Employees1,150

SectorUtilities

Sector Strength76

IndustryRenewable Utilities

Share Statistics

EPS (TTM)0.18

Shares Outstanding261,502,040

10 Day Avg. Volume40,087

30 Day Avg. Volume63,877

Financial Highlights & Ratios

PEG Ratio0.07

Price to Book (P/B)1.18

Price to Sales (P/S)0.00

P/FCF Ratio12.47

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$18.96

Price Target Upside24.00% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering6

Northland Power Business Overview & Revenue Model

Company DescriptionNorthland Power Inc., an independent power producer, develops, builds, owns, and operates clean and green power projects in North America, Europe, Latin America, and Asia. The company produces electricity from renewable resources, such as wind, solar, or hydropower, as well as clean-burning natural gas and biomass for sale under power purchase agreements and other revenue arrangements. It owned or had an economic interest in 3.2 gigawatts of operating generating capacity. The company was founded in 1987 and is headquartered in Toronto, Canada.

How the Company Makes Money

Northland Power Earnings Call Summary

Earnings Call Date:May 14, 2025

(Q1-2025)

% Change Since: 7.83%|

Next Earnings Date:Aug 07, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant achievements such as the completion of the Oneida Battery Storage Project and progress on offshore wind projects, which demonstrate Northland Power's operational capabilities and strategic growth. However, financial performance was impacted by historically low offshore wind resources, leading to decreased EBITDA and free cash flow. The company maintains a strong financial position and remains on track to meet its financial guidance, balancing the challenges with strategic achievements.

Q1-2025 Updates

Positive Updates

Successful Completion of Oneida Battery Storage Project

Completed ahead of schedule and under budget. It's the largest energy storage project in Canada, generating revenue and supporting over 180 jobs during peak construction.

Progress on Offshore Wind Projects

Hai Long and Baltic Power projects are on track, with significant milestones achieved including turbine installations and foundation completions. Total investment for these projects is approximately $15 billion.

Recognition for Safety Innovation

EBSA utility in Colombia received the CCS Award for Innovation in Safety, demonstrating Northland Power's commitment to safety and innovation.

Strong Financial Position

Northland Power maintains a strong balance sheet with $1.1 billion of available corporate liquidity, supporting its ability to pursue growth opportunities.

Maintained Financial Guidance

Despite challenges, Northland Power is on track to meet its financial guidance set earlier this year.

Negative Updates

Decrease in Adjusted EBITDA

Adjusted EBITDA decreased by 20% compared to the same quarter in 2024, primarily due to historically low offshore wind resources in the North Sea.

Decline in Free Cash Flow

Free cash flow for Q1 was $157 million, 30% lower than the same quarter last year, with per share free cash flow decreasing from $0.88 to $0.60.

Impact of Low Offshore Winds

The low wind resource was the lowest seen across Northland's time invested in European offshore wind assets, impacting financial performance.

Company Guidance

During the Northland Power Conference Call held on May 14, 2025, the management provided guidance on the company's operations and financial performance for the first quarter of 2025. Christine Healy, President and CEO, highlighted the successful completion of the Oneida Battery Storage project, which was finished ahead of schedule and under budget, and marked as Canada's largest energy storage project. The company also advanced its offshore wind projects, Hai Long and Baltic Power, with a combined investment of approximately $15 billion and 2.2 gigawatts of capacity. Despite a significant 20% decrease in adjusted EBITDA to $361 million, primarily due to historically low offshore wind resources, the company maintained robust operational performance with a 95% commercial availability rate. Free cash flow for the quarter was $157 million, representing a 30% decline from the previous year. The management reiterated their commitment to meeting the financial guidance set earlier in the year, emphasizing a strong balance sheet with $1.1 billion in available corporate liquidity. Northland Power is actively pursuing growth through a diversified portfolio, including new battery storage projects and participating in procurement processes, while remaining resilient to macroeconomic challenges such as U.S. tariffs.

Northland Power Financial Statement Overview

Summary

Northland Power showcases a strong financial position with consistent revenue growth and improved profitability. High leverage is a concern, but effective cash flow management supports operations and growth initiatives. The improvement in net income and free cash flow suggests a positive trajectory, though attention to debt levels is important.

Income Statement

Positive

Northland Power demonstrates solid revenue growth with a 5.1% increase from 2023 to 2024 and a recovery in net income from a loss in 2023 to a profit in 2024. The gross profit margin remains strong, indicating efficient cost management. However, the net profit margin is relatively low at 11.6% due to high interest and tax expenses, suggesting room for profitability improvements.

Balance Sheet

Positive

The balance sheet shows a relatively high debt-to-equity ratio of 1.72, indicating significant leverage, which could pose risks if not managed well. However, the company has maintained solid equity growth over the years, and the equity ratio of 30.8% suggests a reasonable proportion of assets financed by shareholders' equity. The return on equity improved to 6.5% in 2024, which is a positive sign.

Cash Flow

Positive

Northland Power's cash flow statement reflects a robust operating cash flow, which increased significantly from 2023 to 2024. The free cash flow growth of 38.9% is impressive, indicating effective capital expenditure management. The operating cash flow to net income ratio is high, showing strong cash generation relative to reported profits.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
2.35B	2.23B	2.45B	2.09B	2.06B
	Gross Profit
1.01B	1.61B	2.18B	1.88B	1.86B
	EBIT
812.89M	741.16M	1.05B	808.65M	900.21M
	EBITDA
1.59B	1.26B	2.22B	1.41B	1.54B
	Net Income Common Stockholders
271.82M	-175.19M	827.73M	269.88M	381.08M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
613.32M	813.50M	1.30B	673.69M	434.99M
	Total Assets
13.60B	13.63B	14.22B	12.88B	11.40B
	Total Debt
7.20B	7.20B	7.17B	7.63B	7.59B
	Net Debt
6.59B	6.55B	5.87B	6.96B	7.15B
	Total Liabilities
9.05B	9.14B	9.50B	9.91B	9.40B
	Stockholders Equity
4.19B	4.19B	4.39B	2.76B	1.58B
Cash Flow		Free Cash Flow
476.75M	343.05M	1.31B	1.14B	1.10B
	Operating Cash Flow
1.03B	785.21M	1.83B	1.61B	1.32B
	Investing Cash Flow
-448.81M	-1.17B	-629.68M	-1.03B	-839.27M
	Financing Cash Flow
-720.25M	-262.04M	-604.84M	-225.68M	-389.53M

Northland Power Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NPIFF		$3.96B	21.18	6.08%	5.74%	―	―
Sector *	64 Neutral	$8.53B	10.34	4.24%	4.37%	4.14%	-13.04%
BEP		$15.87B	―	-5.97%	6.03%	―	―
INE	67 Neutral	C$2.79B	69.91	4.20%	2.62%	0.97%	―
BLX	63 Neutral	C$3.27B	297.57	0.67%	2.07%	-16.63%	-87.78%
PIF	62 Neutral	C$248.26M	59.81	-4.70%	7.09%	-1.45%	-210.16%
AQN		$4.49B	―	5.54%	5.21%	―	―

* Utilities Sector Average

Performance Comparison

NPIFF

Northland Power

15.29

-1.42

-8.50%

BEP

Brookfield Renewable Partners

25.80

1.17

4.75%

TSE:BLX

Boralex Inc Cl A

31.81

-2.01

-5.94%

TSE:INE

Innergex Renewable Energy

13.74

3.56

34.97%

TSE:PIF

Polaris Infrastructure

11.82

-0.55

-4.45%

AQN

Algonquin Power & Utilities

5.79

0.29

5.27%

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.