TransAlta (TA) AI Stock Analysis

• Market Cap: $7.16B
• Dividend Yield: 1.03%
• Average Volume (3M): 1.76M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.89
• Revenue Growth: -20.91%
• EPS Growth: -127.48%
• Country: CA
• Employees: 1,165
• Sector: Utilities
• Sector Strength: 65
• Industry: Independent Power Producers
• EPS (TTM): 0.18
• Shares Outstanding: 296,400,000
• 10 Day Avg. Volume: 2,474,823
• 30 Day Avg. Volume: 1,760,550
• PEG Ratio: -0.36
• Price to Book (P/B): 3.52
• Price to Sales (P/S): 2.16
• P/FCF Ratio: 12.93
• Enterprise Value/Market Cap: 1.34
• Enterprise Value/Revenue: 3.84
• Enterprise Value/Gross Profit: 11.78
• Enterprise Value/Ebitda: 11.43
• 1Y Price Target: $22.40
• Price Target Upside: -7.27% Downside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 62 Neutral
• Price Target: C$25.00 ▲(3.48% Upside)

TransAlta's overall stock score is primarily driven by strong technical indicators and a positive earnings call, which highlight strategic advancements and robust financial performance in the second quarter. However, financial performance and valuation concerns, including high leverage and negative profitability, weigh down the score. Investors should be cautious of potential pullbacks due to overbought technical conditions.

Positive Factors

Renewable Energy Transition

TransAlta's focus on transitioning to renewable energy sources positions it well for long-term growth, aligning with global sustainability trends and increasing demand for clean energy.

Effective Hedging Strategies

Effective hedging strategies enhance revenue stability and reduce exposure to volatile market prices, supporting consistent cash flow and financial performance.

Data Center Strategy Progress

Progress in the data center strategy indicates potential for new revenue streams and diversification, leveraging growing demand for data infrastructure.

Negative Factors

High Leverage

High leverage can strain financial flexibility and increase risk, especially if profitability does not improve, potentially impacting long-term stability.

Declining Revenue Trend

A declining revenue trend may indicate challenges in maintaining market share or competitiveness, affecting long-term growth prospects and financial health.

Profitability Challenges

Negative profitability suggests operational inefficiencies and can hinder reinvestment in growth initiatives, impacting long-term value creation.

TransAlta Business Overview & Revenue Model

Company Description

TransAlta Corporation owns, operates, and develops a diverse fleet of electrical power generation assets in Canada, the United States, and Australia. It operates through four segments: Hydro, Wind and Solar, Gas, and Energy Transition. owns and operates hydro, wind and solar, natural gas-fired, and coal-fired facilities. The company also engages in wholesale trading of electricity and other energy-related commodities and derivatives; and related mining operations and natural gas pipeline operations. It serves municipalities, medium and large industries, businesses, and utility customers. The company was founded in 1909 and is headquartered in Calgary, Canada.

How the Company Makes Money

TransAlta generates revenue primarily through the sale of electricity produced from its power generation facilities. The company operates a mix of regulated and unregulated power plants, allowing it to earn revenue from both long-term power purchase agreements (PPAs) and spot market sales. Key revenue streams include: 1) Sale of electricity: TransAlta sells the electricity generated from its facilities to utilities, large industrial customers, and on the wholesale market. 2) Ancillary services: The company provides services that help maintain grid stability, such as frequency regulation and spinning reserves, which are compensated by grid operators. 3) Renewable energy credits (RECs) and carbon credits: As part of its commitment to sustainability, TransAlta also benefits from the sale of RECs and carbon credits. 4) Strategic partnerships: Collaborations with other energy providers and participation in joint ventures can enhance operational efficiency and expand market reach. Factors contributing to earnings include regulatory frameworks, market demand for clean energy, and the company’s efforts to transition its portfolio towards renewable energy sources.

TransAlta Financial Statement Overview

Summary

TransAlta faces challenges with declining revenues and profitability, as evidenced by negative net profit margins and high leverage. Despite these challenges, the company shows resilience in cash flow generation, with positive free cash flow growth. The balance sheet remains leveraged, posing potential risks if profitability does not improve.

Income Statement

The income statement shows a declining revenue trend with a negative revenue growth rate of -5.61% in the TTM period. Gross profit margin remains relatively strong at 61.43%, but the net profit margin is negative at -4.59%, indicating profitability challenges. EBIT and EBITDA margins have also decreased compared to previous years, reflecting operational inefficiencies.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 2.86, indicating significant leverage. Return on equity is negative at -6.69%, reflecting poor profitability. However, the equity ratio is stable, suggesting a balanced asset structure despite high debt levels.

Cash Flow

Cash flow analysis shows a positive free cash flow growth rate of 11.59% in the TTM period, indicating improved cash generation. The operating cash flow to net income ratio is 0.33, suggesting moderate cash flow efficiency. However, the free cash flow to net income ratio is 0.51, indicating some challenges in converting income into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.51B	2.85B	3.35B	2.98B	2.72B	2.10B
Gross Profit	817.00M	1.14B	1.64B	1.11B	978.00M	661.00M
EBITDA	842.00M	1.16B	1.71B	1.24B	1.17B	810.00M
Net Income	-115.00M	229.00M	695.00M	50.00M	-537.00M	-287.00M
Balance Sheet
Total Assets	8.94B	9.50B	8.66B	10.74B	9.23B	9.75B
Cash, Cash Equivalents and Short-Term Investments	222.00M	337.00M	348.00M	1.13B	947.00M	703.00M
Total Debt	4.51B	4.56B	4.21B	4.41B	4.00B	4.09B
Total Liabilities	7.28B	7.66B	7.00B	8.75B	6.63B	6.31B
Stockholders Equity	1.58B	1.75B	1.54B	1.11B	1.58B	2.35B
Cash Flow
Free Cash Flow	308.00M	475.00M	576.00M	-72.00M	512.00M	202.00M
Operating Cash Flow	608.00M	796.00M	1.46B	877.00M	1.00B	702.00M
Investing Cash Flow	-607.00M	-519.00M	-815.00M	-741.00M	-471.00M	-648.00M
Financing Cash Flow	-121.00M	-291.00M	-1.43B	45.00M	-282.00M	272.00M

TransAlta Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 24.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TA, the sentiment is Positive. The current price of 24.16 is above the 20-day moving average (MA) of 21.78, above the 50-day MA of 19.20, and above the 200-day MA of 15.77, indicating a bullish trend. The MACD of 1.49 indicates Negative momentum. The RSI at 79.46 is Negative, neither overbought nor oversold. The STOCH value of 78.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TA.

TransAlta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INE	―	―	―	―	―	0.97%	―
CPX	―	C$11.06B	22.26	10.00%	3.72%	-16.83%	-37.24%
NPI	―	$6.61B	―	-1.19%	4.92%	-8.39%	-180.67%
Sector *	―	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
TA	―	$7.16B	―	-6.83%	1.03%	-20.91%	-127.48%
BLX	―	C$2.88B	―	-0.61%	2.38%	-13.45%	-112.19%
AQN	―	C$6.19B	―	1.50%	4.54%	-6.96%	-1235.30%

TransAlta Corporate Events

TransAlta Declares Quarterly Dividends for Common and Preferred Shares

On October 22, 2025, TransAlta Corporation announced the declaration of a quarterly dividend of $0.065 per common share, payable on January 1, 2026, to shareholders recorded by December 1, 2025. Additionally, the company declared dividends on its Cumulative Redeemable Rate Reset First Preferred Shares for the period from September 30, 2025, to December 31, 2025, with varying rates for different series. This announcement underscores TransAlta’s commitment to delivering shareholder value and reflects its stable financial position, benefiting its stakeholders.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$27.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.

TransAlta to Announce Q3 2025 Financial Results on November 6

TransAlta Corporation announced it will release its third quarter 2025 financial results on November 6, 2025, followed by a conference call and webcast for investors and analysts. This event is significant as it provides stakeholders with insights into the company’s financial health and operational performance, potentially impacting investor decisions and market perceptions.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$23.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.

TransAlta Announces 2025 Investor Day to Unveil Strategic Priorities

TransAlta Corporation announced its 2025 Investor Day event, scheduled for November 18, 2025, in Toronto, offering both in-person and live webcast attendance. The event will feature presentations from top executives, providing insights into the company’s strategic priorities, financial outlook, and growth objectives, reflecting its commitment to transparency and engagement with the investment community.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$21.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.

TransAlta Reports Strong Q2 2025 Results and Strategic Progress

TransAlta Corporation is a leading energy company based in Calgary, Alberta, with operations in Canada, the United States, and Australia. The company specializes in the generation and sale of electricity, with a diverse portfolio that includes wind, hydro, and thermal power assets. TransAlta is recognized for its commitment to sustainability and innovation in the energy sector.

TransAlta Corp’s Q2 2025 Earnings: Positive Outlook Amid Strategic Gains

TransAlta Corp’s Q2 2025 earnings call conveyed a positive sentiment, underscored by robust financial performance and strategic progress, particularly in the Hydro segment and data center initiatives in Alberta. Despite some setbacks in the Gas and Energy Marketing segments, the overall tone was optimistic due to significant achievements and promising future opportunities.

TransAlta Reports Strong Q2 2025 Results and Strategic Progress

TransAlta Corporation reported strong financial results for the second quarter of 2025, with an adjusted EBITDA of $349 million, up from $316 million in the same period of 2024. The company highlighted its strategic advancements, including progress in its Alberta data centre strategy and negotiations for conversion opportunities at Centralia. Key developments included extending credit facilities, divesting the Poplar Hill asset, and recontracting Ontario wind facilities. Despite a net loss attributable to common shareholders of $112 million, TransAlta reaffirmed its 2025 guidance, emphasizing its operational performance and strategic focus.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$17.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.

TransAlta Releases Q2 2025 Financial Results and Strategic Outlook

On July 31, 2025, TransAlta Corporation filed its Management’s Discussion and Analysis (MD&A) and unaudited interim financial statements for the period ending June 30, 2025, with the Securities and Exchange Commission. The release highlights the company’s strategic objectives, financial performance, and operational strategies, including asset optimization and diversification. These documents provide insights into TransAlta’s market positioning and future outlook, emphasizing its commitment to sustainability and growth opportunities, such as the Centralia redevelopment and data center projects.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$17.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.

TransAlta Declares Quarterly Dividends for 2025

TransAlta Corporation has announced the declaration of quarterly dividends for its common and preferred shares, highlighting its commitment to shareholder returns. The dividends, expressed in Canadian dollars, will be payable on October 1, 2025, for common shares and September 30, 2025, for preferred shares, with varying rates for different series. This announcement underscores TransAlta’s stable financial performance and its strategic focus on maintaining investor confidence through consistent dividend payouts.

The most recent analyst rating on (TSE:TA) stock is a Buy with a C$17.00 price target. To see the full list of analyst forecasts on TransAlta stock, see the TSE:TA Stock Forecast page.