Caribbean Utilities Company (CUP.U) AI Stock Analysis

• Market Cap: $557.77M
• Dividend Yield: 4.23%
• Average Volume (3M): 3.18K
• Price to Earnings (P/E): 7.3
• Beta (1Y): 0.20
• Revenue Growth: -0.36%
• EPS Growth: 79.19%
• Country: CA
• Employees: 275
• Sector: Utilities
• Sector Strength: 71
• Industry: Regulated Electric
• EPS (TTM): 0.27
• Shares Outstanding: 42,191,376
• 10 Day Avg. Volume: 5,238
• 30 Day Avg. Volume: 3,176
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.73
• Enterprise Value/Revenue: 3.35
• Enterprise Value/Gross Profit: 8.98
• Enterprise Value/Ebitda: 10.35
• 1Y Price Target: $14.00
• Price Target Upside: 5.66% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 65 Neutral
• Price Target: $14.00 ▲(5.66% Upside)

Caribbean Utilities Company has a solid valuation with a low P/E ratio and attractive dividend yield, which are significant strengths. However, financial challenges such as declining revenue and negative free cash flow, along with neutral technical indicators, moderate the overall score. The company needs to address these financial issues to improve its stock performance.

Caribbean Utilities Company Business Overview & Revenue Model

Company Description

Caribbean Utilities Company, Ltd. generates and distributes electricity in Grand Cayman, the Cayman Islands. The company generates electricity using diesel. As of December 31, 2021, its installed generating capacity is 161 megawatts. It also operates a transmission and distribution system, including 8 transformer substations with approximately 387 miles of overhead high-voltage, 53.8 miles of underground high-voltage, and 14 miles of high-voltage submarine cables. The company also provides telecommunication services. The company was founded in 1966 and is headquartered in Grand Cayman, the Cayman Islands. Caribbean Utilities Company, Ltd. is a subsidiary of Fortis Energy (Bermuda) Ltd.

How the Company Makes Money

CUP.U generates revenue primarily through the sale of electricity to its customer base, which includes residential, commercial, and industrial users. The company's revenue model is structured around fixed and variable tariff rates that are regulated by the government, ensuring a stable income stream. Key revenue streams include base electricity sales, additional charges for peak demand, and fees for ancillary services. Additionally, CUP.U benefits from partnerships with renewable energy providers and government initiatives aimed at increasing the use of sustainable energy sources, which can provide further revenue opportunities through incentives and subsidies.

Caribbean Utilities Company Financial Statement Overview

Summary

Caribbean Utilities Company exhibits strong financial health with consistent revenue growth and profitability. The balance sheet reflects stability, though rising debt levels should be monitored. Cash flow management shows strength in operating activities, but the negative free cash flow suggests a need for careful capital allocation.

Income Statement

The company demonstrates strong revenue growth, with a notable increase from $267.3M in 2022 to $288.1M in TTM (Trailing-Twelve-Months). Gross profit margin remains robust, consistently exceeding 35%, indicating effective cost management. Net profit margin has improved to 15.3% in TTM, reflecting enhanced profitability. However, the slight decline in total revenue compared to 2024 ($293.7M) could signal a need for cautious monitoring.

Balance Sheet

The debt-to-equity ratio is moderate at approximately 1.02, showing a balanced approach to leverage. Return on equity is healthy, rising to 11.2% in TTM, suggesting efficient use of equity capital. The equity ratio stands at 46.2%, indicating a stable financial structure. However, the increase in total debt over recent periods warrants attention to potential leverage risks.

Cash Flow

Operating cash flow remains strong, reaching $89.8M in TTM, but free cash flow has shifted to negative territory at -$12.3M due to significant capital expenditures, which may impact liquidity. The operating cash flow to net income ratio is robust at 2.03, indicating solid cash generation relative to earnings. Maintaining positive free cash flow will be crucial moving forward.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	288.05M	293.68M	287.23M	267.34M	198.48M	177.45M
Gross Profit	107.36M	105.50M	98.71M	90.42M	86.87M	82.59M
EBITDA	93.17M	93.94M	87.13M	71.06M	69.36M	67.23M
Net Income	44.14M	42.69M	38.66M	33.18M	22.19M	15.51M
Balance Sheet
Total Assets	853.55M	850.96M	777.81M	726.54M	634.15M	633.67M
Cash, Cash Equivalents and Short-Term Investments	13.45M	20.20M	3.99M	7.95M	7.36M	45.59M
Total Debt	400.55M	401.46M	399.73M	358.60M	293.38M	307.39M
Total Liabilities	459.50M	457.59M	453.06M	418.31M	336.27M	344.17M
Stockholders Equity	394.05M	393.37M	324.74M	308.23M	297.88M	289.50M
Cash Flow
Free Cash Flow	-12.30M	-9.79M	-20.77M	-41.04M	-1.25M	9.08M
Operating Cash Flow	89.75M	91.46M	80.78M	56.19M	62.01M	66.51M
Investing Cash Flow	-101.35M	-100.43M	-101.22M	-97.19M	-63.13M	-56.28M
Financing Cash Flow	22.24M	25.18M	16.47M	41.59M	-37.11M	11.69M

Caribbean Utilities Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 13.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CUP.U, the sentiment is Negative. The current price of 13.25 is below the 20-day moving average (MA) of 13.35, below the 50-day MA of 13.26, and below the 200-day MA of 13.37, indicating a bearish trend. The MACD of 0.09 indicates Positive momentum. The RSI at 48.51 is Neutral, neither overbought nor oversold. The STOCH value of 16.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:CUP.U.

Caribbean Utilities Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CPX	68 Neutral	C$9.00B	18.33	10.00%	4.60%	-16.83%	-37.24%
CU	68 Neutral	C$7.78B	23.10	7.52%	4.80%	-0.51%	-17.17%
Sector *	67 Neutral	$17.66B	18.13	5.33%	3.62%	7.33%	12.21%
CUP.U	65 Neutral	$557.77M	7.27	12.51%	4.23%	-0.36%	79.19%
AQN	―	$4.43B	―	1.50%	4.47%	―	―
FTS	―	$25.09B	20.62	7.50%	3.50%	―	―
NPIFF	―	$4.22B	22.35	-1.19%	5.32%	―	―