Algonquin Power (TSE:AQN)
NYSE:AQN
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Algonquin Power & Utilities
(NYSE:AQN)
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Rating:51Neutral
Price Target:
C$8.50
▼(-1.96% Downside)
Action:ReiteratedDate:03/26/26
The score is held back primarily by weak financial quality (consistently negative free cash flow and elevated leverage) and soft technical momentum. These are partially offset by a constructive earnings call with reaffirmed guidance, debt reduction/interest savings, and supportive regulated rate-base growth plans, while valuation remains mixed due to a high P/E despite a solid dividend yield.
Positive Factors
Regulated rate-base growth and capex plan
A multi-year regulated capex program and targeted ~6% rate-base CAGR underpin predictable, utility‑style cash flows and allowed returns. The plan drives organic earnings growth over 2–3 years and, with most projects in regulated jurisdictions, reduces volatility versus merchant generation exposure.
Negative Factors
Persistent negative free cash flow
Chronic negative free cash flow across multiple years signals structural capital intensity versus internal cash generation. This necessitates ongoing external financing for growth and dividends, constrains allocation flexibility, and raises sensitivity to higher borrowing costs or market access constraints.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulated rate-base growth and capex plan
A multi-year regulated capex program and targeted ~6% rate-base CAGR underpin predictable, utility‑style cash flows and allowed returns. The plan drives organic earnings growth over 2–3 years and, with most projects in regulated jurisdictions, reduces volatility versus merchant generation exposure.
Read all positive factors
Algonquin Power & Utilities (AQN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$6.72B
Dividend Yield4.32%
Average Volume (3M)2.41M
Price to Earnings (P/E)25.5
Beta (1Y)0.71
Revenue Growth-4.72%
EPS Growth96.98%
CountryCA
Employees3,786
SectorUtilities
Sector Strength65
IndustryRenewable Utilities
Share Statistics
EPS (TTM)0.08
Shares Outstanding768,691,830
10 Day Avg. Volume2,059,457
30 Day Avg. Volume2,413,953
Financial Highlights & Ratios
PEG Ratio-0.23
Price to Book (P/B)1.02
Price to Sales (P/S)1.93
P/FCF Ratio-26.02
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$9.38Price Target Upside8.17% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.36
Revenue Forecast (FY)C$2.53B
Algonquin Power & Utilities Business Overview & Revenue Model
Company Description
Algonquin Power & Utilities Corp., through its subsidiaries, owns and operates a portfolio of regulated and non-regulated generation, distribution, and transmission utility assets. The company operates through two segments, Regulated Services Grou...
How the Company Makes Money
AQN primarily makes money from (1) regulated utility revenues and (2) revenues from electricity generation.
1) Regulated utilities (electric and natural gas)
- Revenue model: The utility subsidiaries earn revenue by delivering electricity and dis...
Algonquin Power & Utilities Earnings Call Summary
Earnings Call Date:Mar 06, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 08, 2026
Earnings Call Sentiment Positive
The call emphasized a clear operational turnaround and balance-sheet strengthening: solid year-over-year adjusted earnings growth (≈17%), adjusted EPS up ~13%, meaningful debt paydown (~$1.6B), large interest expense savings (~$81M Y/Y), improved earned ROE (5.5% → 6.8%), constructive multi-jurisdictional rate-case settlements, and a sizeable regulated capex plan to drive organic rate base growth. Key negatives include a higher-than-expected effective tax rate for 2027 (mid–high 20s) that trims near-term EPS (~$0.03), loss of Atlantica dividend income (~$76M), a $7.3M project write-off, share dilution from prior settlements, and remaining timing/implementation risk on certain rate cases and California wildfire/regulatory exposure. Overall, the positive operational, regulatory, and balance-sheet developments materially outweigh the headwinds, while management retains transparency on remaining execution and tax items.Positive Updates
Strong Full-Year Earnings and Adjusted EPS Outperformance
Full-year GAAP net earnings of $208 million (vs. $54.8 million in 2024) and full-year adjusted net earnings of $258.8 million, up ~17% from $221.6 million in 2024. Full-year adjusted net EPS was $0.34, up from $0.30 in 2024 (≈13% growth) and exceeded the top end of guidance by $0.02.
Negative Updates
Higher Expected Effective Tax Rate for 2027
Updated expectation for the company's effective tax rate in 2027 moved from the low–mid 20s to the mid– to high–20s percent range, creating roughly a $0.03 per-share EPS headwind to 2027 guidance; tax optimization benefits are expected to materialize largely after 2027.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Full-Year Earnings and Adjusted EPS Outperformance
Full-year GAAP net earnings of $208 million (vs. $54.8 million in 2024) and full-year adjusted net earnings of $258.8 million, up ~17% from $221.6 million in 2024. Full-year adjusted net EPS was $0.34, up from $0.30 in 2024 (≈13% growth) and exceeded the top end of guidance by $0.02.
Read all positive updates
Company Guidance
Algonquin reaffirmed 2026 adjusted net EPS guidance of $0.35–$0.37 and revised 2027 adjusted net EPS to $0.38–$0.42 (the change largely reflecting an expected 2027 effective tax rate in the mid‑ to high‑20s% versus prior low‑ to mid‑20s, costing roughly $0.03/share), while outlining a $3.2 billion regulated utility capex plan for 2026–2028 ($800M in 2026, $1.1B in 2027 and $1.3B in 2028) that management expects to fund ~65%–70% internally; year‑end rate base is targeted to grow from ~$8.2B (2025) to ~$8.5B (2026), ~$9.0B (2027) and ~$9.7B (2028), a ~6% CAGR, total debt sits near $6.5B after using ~ $1.6B of sale proceeds to pay down debt, the 2026 APUC financing plan is ~ $1.6B (including ~$1.45B upstream from LUCO) with ~$1.15B of LUCO bond issuance expected to refinance a June 2026 maturity, management expects no equity issuance through 2027, plans to maintain investment‑grade ratings and targets an annualized dividend of $0.26/share (subject to Board approval), and reiterated confidence in executing the drivers behind the guidance despite some tax‑timing and gas operational normalization risks.Algonquin Power & Utilities Financial Statement Overview
Summary
Income Statement
57
Neutral
Balance Sheet
49
Neutral
Cash Flow
38
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.45B | 2.32B | 2.40B | 2.77B | 2.27B |
| Gross Profit | 587.41M | 845.26M | 836.51M | 1.05B | 858.10M |
| EBITDA | 912.60M | 831.16M | 816.62M | 955.99M | 758.75M |
| Net Income | 184.78M | -1.38B | 28.67M | -211.99M | 264.86M |
Balance Sheet | |||||
| Total Assets | 14.11B | 16.96B | 18.37B | 17.63B | 16.80B |
| Cash, Cash Equivalents and Short-Term Investments | 32.64M | 34.84M | 25.05M | 57.62M | 125.16M |
| Total Debt | 6.53B | 6.73B | 7.51B | 7.53B | 6.25B |
| Total Liabilities | 9.07B | 10.78B | 11.43B | 10.47B | 9.10B |
| Stockholders Equity | 4.63B | 4.71B | 5.04B | 5.22B | 5.86B |
Cash Flow | |||||
| Free Cash Flow | -181.42M | -371.94M | -404.59M | -455.94M | -1.17B |
| Operating Cash Flow | 603.99M | 458.59M | 638.22M | 600.67M | 154.82M |
| Investing Cash Flow | 1.19B | 176.05M | -1.00B | -1.47B | -656.52M |
| Financing Cash Flow | -1.85B | -579.38M | 340.20M | 808.32M | 534.21M |
Algonquin Power & Utilities Technical Analysis
Positive
8.67
Price Trends
8.83
Negative
8.60
Positive
8.17
Positive
Market Momentum
-0.06
Negative
49.86
Neutral
48.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:AQN, the sentiment is Positive. The current price of 8.67 is above the 20-day moving average (MA) of 8.60, below the 50-day MA of 8.83, and above the 200-day MA of 8.17, indicating a neutral trend. The MACD of -0.06 indicates Negative momentum. The RSI at 49.86 is Neutral, neither overbought nor oversold. The STOCH value of 48.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:AQN.
Algonquin Power & Utilities Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
64 Neutral | C$266.41M | -64.76 | -1.09% | 7.11% | 8.26% | -267.17% | |
61 Neutral | C$6.28B | -28.57 | -3.92% | 6.80% | -4.86% | -86.64% | |
58 Neutral | C$32.15B | -400.32 | 2.67% | 5.56% | 14.78% | -9.37% | |
57 Neutral | C$311.52M | 44.20 | 8.61% | ― | -30.92% | ― | |
51 Neutral | C$6.72B | 25.55 | 3.88% | 4.32% | -4.72% | 96.98% | |
46 Neutral | C$3.77B | 422.17 | 0.45% | 2.62% | -11.91% | -132.41% |
* Utilities Sector Average
TSE:AQN
Algonquin Power & Utilities
8.74
2.21
33.82%
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21.60%
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183.11%
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.