Capital Power (CPX) AI Stock Analysis

• Market Cap: C$8.26B
• Dividend Yield: 4.82%
• Average Volume (3M): 994.20K
• Price to Earnings (P/E): 10.3
• Beta (1Y): 1.08
• Revenue Growth: -27.55%
• EPS Growth: -12.05%
• Country: CA
• Employees: 741
• Sector: Utilities
• Sector Strength: 84
• Industry: Independent Power Producers
• EPS (TTM): 4.62
• Shares Outstanding: 154,646,900
• 10 Day Avg. Volume: 1,021,002
• 30 Day Avg. Volume: 994,197
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• 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$64.67
• Price Target Upside: 21.15% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

Capital Power's robust financial performance, marked by revenue growth and profitability improvements, is a significant strength. The strategic acquisitions and strong earnings call support the company's growth trajectory. Valuation metrics further enhance its attractiveness, despite technical indicators suggesting cautious market sentiment and potential debt-related risks.

Positive Factors

Acquisition Strategy

The acquisition establishes a foothold in the PJM RTO in the U.S. and diversifies cash flows away from the oversupplied Alberta power market.

Financial Performance

The acquisition enhances CPX's scale and relevance with expected increases in EBITDA, free cash flow, enterprise value, and net capacity.

Market Position

CPX shares are rated Outperform given the attractive relative valuation, exposure to the long-term trend of rising power demand, and upside optionality to the AI data center opportunity.

Negative Factors

Business Mix

The contracted business mix declines to approximately 45% from 75%.

Operational Challenges

Q4/24 results show a 6% miss due to foreign exchange and weather impacts.

Capital Power Business Overview & Revenue Model

Company Description

Capital Power Corporation develops, acquires, owns, and operates renewable and thermal power generation facilities in Canada and the United States. It generates electricity from various energy sources, including wind, solar, waste heat, natural gas, and coal. The company owns an approximately 6,600 megawatts of power generation capacity at 26 facilities. It also manages its related electricity, natural gas, and emissions portfolios by undertaking trading and marketing activities. The company was founded in 1891 and is headquartered in Edmonton, Canada.

How the Company Makes Money

Capital Power generates revenue primarily through the sale of electricity generated by its portfolio of power generation facilities. The company enters into long-term power purchase agreements (PPAs) with various customers, including utilities, commercial entities, and governmental bodies, which provide a stable and predictable revenue stream. Additionally, Capital Power participates in wholesale electricity markets, selling electricity at spot market prices, which can contribute to revenue growth. The company also benefits from government incentives and subsidies related to renewable energy projects and carbon credits, which support its financial performance as it invests in cleaner energy technologies. Strategic partnerships and joint ventures are also significant contributors, allowing Capital Power to leverage expertise and share the financial risks associated with large-scale energy projects.

Capital Power Financial Statement Overview

Summary

Capital Power has demonstrated strong revenue growth and improved profitability margins, supported by effective cost management. The balance sheet reflects a stable but leveraged capital structure, with potential risks from high debt levels. Cash flows indicate healthy operational efficiency, though capital investments are significant, impacting free cash flow.

Income Statement

The company has demonstrated strong revenue growth with a consistent increase in total revenue from $1.77 billion in 2019 to $3.77 billion in 2024. The Gross Profit Margin is robust, maintaining around 50% in recent years, indicating good control over production costs. Net Profit Margin has improved significantly to 18.5% in 2024 from 7.0% in 2020, reflecting enhanced profitability. However, EBIT and EBITDA margins have seen fluctuations due to variable operating costs and financial expenses.

Balance Sheet

Capital Power's balance sheet shows a stable equity position with a growth in stockholders' equity from $2.90 billion in 2020 to $4.58 billion in 2024, increasing the equity ratio. However, the Debt-to-Equity Ratio is relatively high at 1.12 in 2024, indicating a significant reliance on debt financing, which could pose risks if interest rates rise or earnings fluctuate. The Return on Equity improved to 15.3% in 2024, showcasing effective use of equity capital to generate profits.

Cash Flow

Operating cash flow has grown strongly from $611 million in 2020 to $1.14 billion in 2024, suggesting efficient core operations. The Free Cash Flow Growth Rate has been positive, but free cash flow itself is relatively low due to high capital expenditures, indicating substantial reinvestment in business activities. The Operating Cash Flow to Net Income ratio remains above 1, indicating good cash conversion from earnings.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.77B	4.15B	2.80B	1.86B	1.88B
	Gross Profit
1.98B	1.98B	1.22B	1.19B	1.30B
	EBIT
766.00M	1.04B	302.00M	276.00M	412.00M
	EBITDA
1.63B	1.68B	809.00M	828.00M	882.00M
	Net Income Common Stockholders
699.00M	744.00M	138.00M	98.00M	136.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
792.00M	1.42B	290.00M	370.00M	343.00M
	Total Assets
12.93B	11.16B	10.13B	9.07B	8.91B
	Total Debt
5.11B	4.86B	3.87B	3.50B	3.69B
	Net Debt
4.32B	3.44B	3.58B	3.13B	3.35B
	Total Liabilities
8.36B	7.97B	7.67B	6.21B	5.98B
	Stockholders Equity
4.58B	3.19B	2.45B	2.84B	2.90B
Cash Flow		Free Cash Flow
74.00M	45.00M	253.00M	245.00M	305.00M
	Operating Cash Flow
1.14B	768.00M	935.00M	867.00M	611.00M
	Investing Cash Flow
-1.92B	-807.00M	-910.00M	-565.00M	-349.00M
	Financing Cash Flow
202.00M	1.16B	-102.00M	-275.00M	-146.00M

Capital Power Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 53.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CPX, the sentiment is Positive. The current price of 53.38 is above the 20-day moving average (MA) of 48.01, above the 50-day MA of 48.20, and above the 200-day MA of 50.82, indicating a bullish trend. The MACD of 1.26 indicates Negative momentum. The RSI at 71.14 is Negative, neither overbought nor oversold. The STOCH value of 83.05 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CPX.

Capital Power Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CPX	78 Outperform	C$8.26B	10.35	15.24%	4.82%	-27.55%	-12.05%
CU	70 Neutral	C$7.71B	25.32	6.93%	4.83%	-1.42%	-36.31%
Sector *	63 Neutral	$8.48B	11.84	5.32%	4.35%	3.04%	-11.46%

Capital Power Corporate Events

Capital Power Announces 2025 Shareholder Meeting Results

Capital Power Corporation held its annual meeting of shareholders on April 29, 2025, where all 10 director nominees were elected, KPMG LLP was appointed as auditors, and the approach to executive compensation was approved. Additionally, the continuation of the Amended and Restated Shareholder Rights Plan Agreement was passed. These decisions reflect Capital Power’s commitment to maintaining strong governance and operational strategies, reinforcing its position in the power production industry.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Outperform.

Capital Power’s robust financial performance, marked by revenue growth and profitability improvements, is a significant strength. The strategic acquisitions and strong earnings call support the company’s growth trajectory. Valuation metrics further enhance its attractiveness, despite technical indicators suggesting cautious market sentiment and potential debt-related risks.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Declares Quarterly Dividends for 2025

Capital Power has announced dividends for its common and preference shares for the quarter ending June 30, 2025. The dividends, which are eligible for enhanced tax credits under Canadian law, reflect the company’s commitment to providing shareholder returns while acknowledging its operations on Indigenous lands.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Outperform.

Capital Power’s overall score reflects strong financial fundamentals, strategic growth initiatives, and an attractive valuation. The company’s robust revenue growth and profitability improvements are significant strengths, while high leverage poses a potential risk. Technical indicators are mixed, suggesting cautious market sentiment. Strategic acquisitions and a high dividend yield present potential opportunities for investors, positioning the company well for future growth despite sector challenges.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Reports Strong Q1 2025 Results Amid Strategic Expansion

Capital Power Corporation reported strong financial results for the first quarter of 2025, driven by strategic acquisitions and ongoing projects. The company entered into an agreement to acquire two natural gas-fired power generation facilities in the PJM market, adding significant capacity to its U.S. portfolio. This move is expected to enhance long-term cash flow and shareholder value. Additionally, Capital Power is progressing with growth projects in Ontario and has commenced construction of a solar project in North Carolina, reflecting its commitment to diversification and risk management. The company’s financial performance, including increased adjusted EBITDA and net income, underscores the effectiveness of its strategy and its ability to provide stable returns to shareholders.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Outperform.

Capital Power’s overall score reflects strong financial fundamentals, strategic growth initiatives, and an attractive valuation. The company’s robust revenue growth and profitability improvements are significant strengths, while high leverage poses a potential risk. Technical indicators are mixed, suggesting cautious market sentiment. Strategic acquisitions and a high dividend yield present potential opportunities for investors, positioning the company well for future growth despite sector challenges.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Closes $667 Million Share Offering to Fund U.S. Acquisitions

Capital Power Corporation has successfully closed a $667 million offering of common shares, which includes both a public offering and a private placement. The proceeds from this offering will be used to fund the acquisition of Hummel Station, LLC and Rolling Hills Generating, L.L.C., two significant natural gas facilities in the United States. This acquisition is expected to enhance Capital Power’s operational capacity and market positioning in the energy sector, although the completion of the acquisition is subject to regulatory approvals.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Outperform.

Capital Power scores a 75, driven by strong financial performance, strategic growth initiatives, and attractive valuation. The company benefits from robust revenue growth and profitability improvements, though the high leverage introduces risk. Technical indicators are mixed, indicating cautious market sentiment. The strategic acquisitions and high dividend yield present potential opportunities for investors, positioning the company well for future growth despite sector challenges.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Upsizes Bought Deal Offering to Fund Strategic Acquisitions

Capital Power Corporation has announced an increase in its previously declared bought deal offering of common shares, raising approximately $450 million in gross proceeds. The funds from this offering, along with a private placement, will be used to finance the acquisition of Hummel Station, LLC and Rolling Hills Generating, L.L.C., or alternatively, to support future growth opportunities, capital expenditures, or debt reduction.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Outperform.

Capital Power’s overall score reflects strong financial fundamentals and strategic growth initiatives, counterbalanced by bearish technical indicators and high leverage. The attractive valuation and high dividend yield present potential opportunities for investors.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Expands with Strategic Acquisition in PJM Market

Capital Power Corporation has announced the acquisition of two natural gas facilities, Hummel Station and Rolling Hills, for approximately US$2.2 billion. This strategic move is expected to enhance Capital Power’s position in the PJM market, making it one of the top five North American IPPs with over 10 GW of natural gas capacity. The acquisition is anticipated to be immediately accretive to the company’s adjusted funds from operations per share, and it aligns with Capital Power’s strategy to diversify and expand its North American operations.

Spark’s Take on TSE:CPX Stock

According to Spark, TipRanks’ AI Analyst, TSE:CPX is a Neutral.

Capital Power’s strong financial performance and strategic growth initiatives are significant strengths, highlighting robust revenue growth, profitability, and strategic positioning for future growth. However, bearish technical indicators and high leverage are key risks. The stock’s attractive valuation and dividend yield offer potential upside. Overall, the company is well-positioned but faces challenges, particularly in market sentiment and technical momentum.

To see Spark’s full report on TSE:CPX stock, click here.

Capital Power Reports Strong 2024 Results and Strategic Growth

Capital Power Corporation announced its fourth quarter and year-end 2024 results, highlighting significant achievements such as the completion of the Genesee Repowering project, which reduced CO2 emissions and increased capacity. The company enhanced its U.S. market presence through acquisitions and solar project developments, while also improving financial flexibility through asset sell-downs and equity financing. These strategic moves position Capital Power for continued growth in the expanding energy sector, supported by a well-maintained asset fleet and access to capital.

Capital Power Announces Dividend Payments for 2025

Capital Power Corporation announced dividends for its common and preference shares, with payments scheduled for April 30, 2025, and March 31, 2025, respectively. These dividends are eligible for enhanced dividend tax credits under Canadian law, potentially benefiting shareholders by reducing their income tax obligations.