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AltaGas
(TSX:ALA)
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Rating:66Neutral
Price Target:
C$60.00
â–²(4.93% Upside)
Action:Reiterated
Date:08/03/26
The score is driven primarily by mixed financial performance—solid revenue and improving leverage but persistently negative free cash flow is a meaningful constraint. Technicals are supportive with price above major moving averages and positive MACD. The latest earnings call adds strength via raised 2026 guidance and strong operational momentum, while valuation remains a headwind due to the higher P/E despite a moderate dividend yield.
Positive Factors
Diversified Business Model
AltaGas combines fee‑based midstream contracts with a regulated utilities business, creating durable, less cyclical cash flows. Fee revenue limits commodity exposure while the utilities segment delivers rate‑base growth and regulated returns, supporting steady earnings over months.
Negative Factors
Negative Free Cash Flow
Despite solid operating cash, FCF is negative and failed to cover net income, indicating capital spending and other uses consume inflows. Persistent negative FCF constrains internal funding for growth, dividends or debt paydown and raises reliance on external financing.
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Positive Factors
Negative Factors
Diversified Business Model
AltaGas combines fee‑based midstream contracts with a regulated utilities business, creating durable, less cyclical cash flows. Fee revenue limits commodity exposure while the utilities segment delivers rate‑base growth and regulated returns, supporting steady earnings over months.
Read all positive factors
AltaGas (ALA) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$16.59B
Dividend Yield2.42%
Average Volume (3M)1.19M
Price to Earnings (P/E)27.0
Beta (1Y)0.14
Revenue Growth8.91%
EPS Growth-24.51%
CountryCA
Employees2,853
SectorEnergy
Sector Strength52
IndustryRegulated Gas
Share Statistics
EPS (TTM)1.97
Shares Outstanding312,005,550
10 Day Avg. Volume1,831,664
30 Day Avg. Volume1,188,493
Financial Highlights & Ratios
PEG Ratio0.62
Price to Book (P/B)1.41
Price to Sales (P/S)1.00
P/FCF Ratio-36.59
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$60.63Price Target Upside6.02% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)2.51
Revenue Forecast (FY)C$14.04B
AltaGas Business Overview & Revenue Model
Company Description
AltaGas Ltd., founded in Calgary, Canada, in 1994, operates as a prominent energy infrastructure enterprise across North America. The company's business is structured into two main divisions: Utilities and Midstream. Its Utilities segment oversees...
How the Company Makes Money
AltaGas primarily makes money through two business segments: (1) Midstream and (2) Utilities. In Midstream, it earns revenue by providing fee-based services across the natural gas value chain—such as gathering, processing, fractionation, storage, ...
AltaGas Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 29, 2026
Earnings Call Sentiment Positive
The call conveyed predominantly positive momentum: record Q2 results, raised 2026 guidance, record LPG exports (144,000 bbl/d, +13% YoY), strong hedging coverage and a solid balance sheet (4.4x leverage) underpin a confident growth outlook. Key growth projects show advanced progress (REEF 85% complete, Opti I/II advancement, Dimsdale, MVP Southgate) and Utilities modernization is driving rate base growth and regulatory wins. Offsetting risks include in‑water REEF delays and a ~12% cost increase from unforeseen marine/weather impacts, a revised REEF in‑service timing (now before Q1 2027), a planned Harmattan turnaround, and some ongoing regulatory and partner‑specific uncertainties. Overall, the positives — record performance, raised guidance, strong hedging, project progress and balance sheet flexibility — materially outweigh the project execution and regulatory risks highlighted.Positive Updates
Record Quarterly Financial Performance
Q2 normalized EBITDA of $391 million and normalized EPS of $0.31, increases of 14% and 15% versus Q2 2025, driven by strong Midstream and Utilities execution.
Negative Updates
REEF In‑Water Construction Delays and Cost Pressure
In‑water construction at REEF lost over 450 rig days due to extreme weather, ocean swells and marine mammal activity; as a result REEF capital cost estimate increased by ~12% to ~$1.5 billion and onshore efficiencies are no longer expected to fully offset higher in‑water costs.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Financial Performance
Q2 normalized EBITDA of $391 million and normalized EPS of $0.31, increases of 14% and 15% versus Q2 2025, driven by strong Midstream and Utilities execution.
Read all positive updates
Company Guidance
AltaGas raised its 2026 outlook, increasing normalized EBITDA by 4% to $2.0–$2.1 billion and normalized EPS by 6% to $2.35–$2.60 per share (company-wide Q2 normalized results were $391 million EBITDA and $0.31 EPS, up 14% and 15% YoY), with Midstream Q2 EBITDA $285 million (↑33% YoY) and Utilities $142 million (↑6% YoY); the company also said it is positioned to deliver >10% YoY EBITDA growth. The 2026 capital budget was increased to $1.8 billion (from $1.7B) with 61% allocated to Utilities and 36% to Midstream, the trailing 12‑month adjusted net debt/normalized EBITDA ratio exited Q2 at 4.4x (below the 4.5–5.0x target range and expected to trend toward the midpoint), and longer‑term CAGRs were updated to ~8% EPS and 7% EBITDA. Management highlighted strong risk management and operational positioning — record LPG exports of 144,000 bpd (↑13% YoY), ~91% of remaining 2026 export volumes tolled or hedged (average FEI–NA spread ≈ US$21.81/bbl), 84% of expected frac volumes hedged at ≈ $22/bbl, REEF now ~85% complete with capital up ~12% to ~$1.5 billion and expected online before end of Q1 2027, and funding capacity of roughly $1.6–$1.8 billion per year.AltaGas Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
66
Positive
Cash Flow
48
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.78B | 12.55B | 12.45B | 12.89B | 14.39B | 10.63B |
| Gross Profit | 3.19B | 3.02B | 2.76B | 2.26B | 2.81B | 2.46B |
| EBITDA | 1.59B | 2.02B | 1.62B | 1.70B | 1.48B | 1.41B |
| Net Income | 632.00M | 768.00M | 596.00M | 673.00M | 523.00M | 283.00M |
Balance Sheet | ||||||
| Total Assets | 27.71B | 26.77B | 26.09B | 23.47B | 23.96B | 21.59B |
| Cash, Cash Equivalents and Short-Term Investments | 131.00M | 99.00M | 85.00M | 95.00M | 53.00M | 63.00M |
| Total Debt | 10.77B | 10.54B | 10.57B | 9.88B | 10.17B | 8.71B |
| Total Liabilities | 17.43B | 17.22B | 17.05B | 15.61B | 16.35B | 13.99B |
| Stockholders Equity | 9.53B | 8.91B | 8.75B | 7.71B | 7.46B | 6.95B |
Cash Flow | ||||||
| Free Cash Flow | -416.00M | -344.00M | 149.00M | 178.00M | -419.00M | -76.00M |
| Operating Cash Flow | 1.31B | 1.24B | 1.54B | 1.12B | 539.00M | 738.00M |
| Investing Cash Flow | -1.50B | -1.28B | -1.38B | -199.00M | -997.00M | -483.00M |
| Financing Cash Flow | 6.00M | 54.00M | -175.00M | -882.00M | 435.00M | -245.00M |
AltaGas Technical Analysis
Positive
57.18
Price Trends
54.31
Negative
52.55
Positive
47.60
Positive
Market Momentum
-0.36
Positive
46.73
Neutral
49.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ALA, the sentiment is Positive. The current price of 57.18 is above the 20-day moving average (MA) of 54.63, above the 50-day MA of 54.31, and above the 200-day MA of 47.60, indicating a neutral trend. The MACD of -0.36 indicates Positive momentum. The RSI at 46.73 is Neutral, neither overbought nor oversold. The STOCH value of 49.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ALA.
AltaGas Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | C$8.21B | 33.97 | 9.48% | 2.99% | 6.68% | 11.02% | |
66 Neutral | C$16.59B | 27.04 | 7.00% | 2.27% | 8.91% | -24.51% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
62 Neutral | C$5.51B | 31.86 | 18.23% | 5.66% | 18.62% | 3.09% | |
59 Neutral | C$1.60B | -134.62 | -0.41% | 2.20% | -6.92% | -112.94% | |
57 Neutral | C$17.26B | 41.43 | 6.59% | 3.56% | 0.24% | -38.65% | |
47 Neutral | C$7.47B | -14.06 | 25.58% | 4.16% | 0.27% | 69.31% |
* Energy Sector Average
TSE:ALA
AltaGas
53.66
13.24
32.76%
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37.95%
TSE:SPB
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TSE:BIPC
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54.27
2.21
4.25%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.