Algonquin Power & Utilities (AQN) AI Stock Analysis

• Market Cap: C$6.81B
• Dividend Yield: 4.32%
• Average Volume (3M): 2.24M
• Price to Earnings (P/E): 25.5
• Beta (1Y): 0.76
• Revenue Growth: -4.72%
• EPS Growth: 96.98%
• Country: CA
• Employees: 3,786
• Sector: Utilities
• Sector Strength: 65
• Industry: Renewable Utilities
• EPS (TTM): 0.08
• Shares Outstanding: 768,691,830
• 10 Day Avg. Volume: 2,642,728
• 30 Day Avg. Volume: 2,235,686
• 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 Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$9.33
• Price Target Upside: 3.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 0.36
• Revenue Forecast (FY): C$2.53B

• Rating: 50 Neutral
• Price Target: C$8.50 ▼(-5.45% Downside)
• Action: Reiterated Date: 03/13/26
• Date: Action: Reiterated 03/13/26

The score is primarily held back by weak financial quality (high leverage and consistently negative free cash flow) and bearish technical signals. These are partly offset by constructive earnings-call commentary on improving adjusted earnings and interest expense, and a supportive dividend yield, though the P/E does not indicate a clear bargain.

Positive Factors

Diversified Business Model

Algonquin's mix of regulated utility operations and contracted renewable generation pairs predictable, rate‑regulated cash flows with growth from renewable PPAs and incentives. This structural diversification reduces earnings cyclicality and supports medium‑term stability in revenue and capital deployment.

Stable Operating Profitability

Sustained mid‑30% operating margins point to durable core economics across generation and utility assets. Consistent operating profitability helps absorb swings from non‑recurring items and financing costs, supporting ongoing maintenance capex and operational resilience over the next several quarters.

Regulatory Rate Progress

Active regulatory approvals and material pending rate requests are structural growth levers for the utilities business. Favorable rate outcomes expand the allowed return base and translate directly into steadier, higher utility cash flows and reduced exposure to merchant price volatility over multiple years.

Negative Factors

Persistent Negative Free Cash Flow

Negative free cash flow across 2020–2025 indicates structural capital intensity and inability to self‑fund growth or consistently return capital. Ongoing FCF shortfalls force reliance on external financing, increasing refinancing risk and sensitivity to higher interest rates over the medium term.

Elevated Leverage

Higher leverage materially constrains financial flexibility and heightens exposure to rising rates or regulatory timing delays. With debt about 1.4x equity, the company faces reduced capacity for opportunistic acquisitions, de‑risking the balance sheet, or absorbing cash‑flow shocks without raising additional costlier capital.

Operational Execution & Earnings Volatility

Recurring restructuring charges, unresolved regulatory settlements and billing‑system issues are structural execution risks that produce one‑off costs and operational disruption. These frictions have driven volatile net results historically and can impede consistent earnings and customer service quality over the medium term.

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 Group and Renewable Energy Group. The Regulated Services Group segment operates a portfolio of rate-regulated utilities located in the United States, Canada, Chile, and Bermuda. Its utilities provide distribution services to approximately 1,093,000 customer connections in the electric, natural gas, and water and wastewater sectors The Renewable Energy Group segment generates and sells electrical energy, capacity, ancillary products, and renewable attributes produced by its portfolio of renewable and clean power generation facilities primarily in the United States and Canada. It owns and operates hydroelectric, wind, solar, and thermal facilities; and owns and operates a portfolio of clean energy and water infrastructure assets. The company was incorporated in 1988 and is headquartered in Oakville, Canada.

How the Company Makes Money

Algonquin Power & Utilities generates revenue primarily through its two segments: the Renewable Energy Group and the Utilities Group. In the Renewable Energy Group, the company earns money from the sale of electricity generated from its renewable energy facilities, often through long-term power purchase agreements (PPAs) with utility companies and large consumers. This segment benefits from government incentives and subsidies for renewable energy production. The Utilities Group generates revenue by providing regulated utility services to customers, which includes collecting fees for electricity, natural gas, and water services. The revenue in this segment is typically stable and predictable due to regulated pricing structures set by government authorities. Additionally, AQN often engages in strategic partnerships and acquisitions to expand its renewable energy portfolio and enhance its utility operations, further contributing to its earnings.

Algonquin Power & Utilities Financial Statement Overview

Summary

Operating profitability has been fairly steady and 2025 returned to positive net income, but the balance sheet is constrained by elevated leverage and cash generation is the key weakness with persistently negative free cash flow across 2020–2025.

Income Statement

Revenue has been choppy but stabilizing, with 2025 returning to modest growth after declines in 2023–2024. Profitability improved meaningfully in 2025 with positive net income after a very large loss in 2024, while operating profitability (EBITDA margin) has remained fairly steady in the mid-30% range. The key weakness is earnings volatility—net margin swung from strongly positive in 2020/2021 to losses in 2022 and especially 2024—suggesting results can be sensitive to non-recurring items, financing costs, and/or asset-related charges.

Balance Sheet

Leverage is elevated and persistent, with debt running at roughly 1.4x equity in 2023–2025 (up from below 1.0x in 2020), which can pressure financial flexibility in a higher-rate environment. Equity has been relatively stable year-to-year, but returns to shareholders have been inconsistent (negative in 2022 and 2024, low-positive in 2023 and 2025). The balance sheet is not distressed based on the data shown, but the combination of high leverage and uneven returns is a clear constraint.

Cash Flow

Operating cash flow is positive and improved in 2025 versus 2024, which supports core business durability. However, free cash flow is negative every year provided (2020–2025), and it deteriorated again in 2025 versus 2024, indicating ongoing capital intensity and/or funding needs that likely require external financing. A positive factor is that operating cash generation appears steadier than reported earnings in some years, but the structural lack of free cash flow is the central weakness.

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

• Technical Analysis Sentiment: Positive
• Last Price: 8.99
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: 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 8.99 is below the 20-day moving average (MA) of 9.06, above the 50-day MA of 8.97, and above the 200-day MA of 8.25, indicating a neutral trend. The MACD of -0.08 indicates Positive momentum. The RSI at 51.50 is Neutral, neither overbought nor oversold. The STOCH value of 50.55 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
PIF	64 Neutral	C$250.73M	-64.76	-1.09%	7.11%	8.26%	-267.17%
BEP.UN	58 Neutral	C$29.74B	-400.32	2.67%	5.56%	14.78%	-9.37%
NPI	58 Neutral	C$5.82B	-28.57	-7.06%	6.80%	-4.86%	-86.64%
AQN	50 Neutral	C$6.81B	25.55	3.96%	4.32%	-4.72%	96.98%
LCFS	50 Neutral	C$235.01M	-42.15	8.61%	―	-30.92%	―
BLX	47 Neutral	C$2.96B	422.17	0.45%	2.62%	-11.91%	-132.41%