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Caribbean Utilities Company Ltd (TSE:CUP.U)
TSX:CUP.U

Caribbean Utilities Company (CUP.U) AI Stock Analysis

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Caribbean Utilities Company

(TSX:CUP.U)

Rating:73Outperform
Price Target:
$14.50
▲(9.68%Upside)
Caribbean Utilities Company has a strong financial foundation and attractive valuation metrics, which contribute positively to its overall score. However, technical analysis indicates neutral momentum, suggesting no immediate bullish or bearish sentiment. The lack of earnings call data and notable corporate events simplifies the assessment, focusing the score on financial and valuation strength.

Caribbean Utilities Company (CUP.U) vs. iShares MSCI Canada ETF (EWC)

Caribbean Utilities Company Business Overview & Revenue Model

Company DescriptionCaribbean 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 MoneyCaribbean Utilities Company makes money primarily through the sale of electricity to its customers, which include residential, commercial, and industrial users. The company generates revenue by charging for electricity consumption based on metered usage, with rates approved by regulatory bodies. Additionally, the company may have revenue streams from service charges, connection fees, and maintenance services. Caribbean Utilities Company also engages in strategic partnerships and investments in renewable energy projects, which could potentially diversify its income sources. The company's earnings are influenced by factors such as regulatory changes, fuel costs, and the economic environment of the Cayman Islands, which impacts electricity demand.

Caribbean Utilities Company Financial Statement Overview

Summary
Caribbean Utilities Company shows strong financial health with consistent revenue growth and improving profitability margins. The balance sheet is stable, though rising debt levels should be monitored. Cash flow management is strong in operating activities, but negative free cash flow suggests a need for careful capital allocation.
Income Statement
85
Very Positive
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
78
Positive
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
72
Positive
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue288.05M293.68M287.23M267.34M198.48M177.45M
Gross Profit107.36M105.50M98.71M90.42M86.87M82.59M
EBITDA93.17M93.94M87.13M71.06M69.36M67.23M
Net Income44.14M42.69M38.66M33.18M22.19M15.51M
Balance Sheet
Total Assets853.55M850.96M777.81M726.54M634.15M633.67M
Cash, Cash Equivalents and Short-Term Investments13.45M20.20M3.99M7.95M7.36M45.59M
Total Debt400.55M401.46M399.73M358.60M293.38M307.39M
Total Liabilities459.50M457.59M453.06M418.31M336.27M344.17M
Stockholders Equity394.05M393.37M324.74M308.23M297.88M289.50M
Cash Flow
Free Cash Flow-12.30M-9.79M-20.77M-41.04M-1.25M9.08M
Operating Cash Flow89.75M91.46M80.78M56.19M62.01M66.51M
Investing Cash Flow-101.35M-100.43M-101.22M-97.19M-63.13M-56.28M
Financing Cash Flow22.24M25.18M16.47M41.59M-37.11M11.69M

Caribbean Utilities Company Technical Analysis

Technical Analysis Sentiment
Negative
Last Price13.22
Price Trends
50DMA
13.34
Negative
100DMA
13.27
Negative
200DMA
13.45
Negative
Market Momentum
MACD
0.04
Positive
RSI
44.51
Neutral
STOCH
8.64
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 13.22 is below the 20-day moving average (MA) of 13.43, below the 50-day MA of 13.34, and below the 200-day MA of 13.45, indicating a bearish trend. The MACD of 0.04 indicates Positive momentum. The RSI at 44.51 is Neutral, neither overbought nor oversold. The STOCH value of 8.64 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

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSCPX
75
Outperform
C$8.83B12.3215.24%4.58%-27.55%-12.05%
73
Outperform
$557.77M7.2812.28%4.08%1.12%78.62%
TSCU
72
Outperform
C$7.74B25.816.76%6.66%-0.53%-31.77%
61
Neutral
C$4.81B-12.84-12.21%4.82%11.13%-68.91%
AQAQN
$4.37B5.54%4.58%
FTFTS
$23.53B19.647.46%3.82%
$4.14B22.036.08%5.53%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:CUP.U
Caribbean Utilities Company
13.35
0.05
0.35%
TSE:CPX
Capital Power
55.98
18.39
48.92%
TSE:CU
Canadian Utilities A
37.40
9.02
31.78%
AQN
Algonquin Power & Utilities
5.73
0.09
1.60%
FTS
Fortis
47.16
9.80
26.23%
NPIFF
Northland Power
15.55
-0.74
-4.54%
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.Date of analysis: Jun 27, 2025