TransAlta Renewables anticipates comparable EBITDA of $480 to $520 million in 2021, representing an increase of 8% at the midpoint. Over the next five years, we anticipate a 2% annual increase in FFO per share.
Dividend Analysis
Given the high yield, TransAlta Renewables’ dividend is undoubtedly a big draw for investors. Furthermore, because this isn’t necessarily a growing company, total gains in the next years will be heavily reliant on the dividend.
Since the IPO in 2013, the company’s dividend has grown at a compound annual rate of 3%, and it now stands at $0.94 per share in Canadian dollars. The annualized dividend payout is approximately $0.76 per share in US dollars, giving a dividend yield of 4.6 percent.
Note that because it is a Canadian stock, US investors investing outside of a retirement plan will be subject to a 15% dividend tax. Here’s a link to our guidance regarding Canadian taxes for US investors.
The stock has risen by more than 50% in the last year, a tremendous and uncommon rally.
Since the IPO, the company’s cash available for distribution has continuously increased. In 2018, the payout ratio was 71 percent in terms of earnings and 82 percent in terms of distributable cash. We anticipate a payout ratio of roughly 67 percent in 2021.
With this in mind, we believe the payout is secure for the time being. As the company’s growth projects come online and contribute to cash flow growth, there may even be room for additional dividend growth.
Final Thoughts
The high dividend yield and monthly dividend payments of TransAlta Renewables appeal to income investors such as retirees right away. Due scrutiny is essential, however, to verify that such a high dividend return can be sustained.
As assessed by Cash Available for Distribution or Funds From Operations, this research reveals that the company’s dividend is very safe.
Over the last year, the price of shares has risen dramatically. While this has rewarded existing shareholders, the stock’s greater value and reduced dividend yield make it less tempting for potential investors.
TransAlta Renewables, on the other hand, could be a good choice for investors searching for a reliable monthly income from the renewable energy business.
Is TransAlta stock a good buy?
TransAlta is rated Buy by the majority of analysts. The average rating score for the company is 2.75, based on 6 buy ratings, 2 hold ratings, and no sell recommendations.
Does TransAlta Renewables pay a dividend?
TransAlta Renewables pays dividends on its common shares on or about the last business day of each calendar month to shareholders of record as of the closure of the mid-month business day. Canadian dollars are used to pay dividends.
Does TransAlta own TransAlta Renewables?
Institutional investors frequently compare their own performance to that of a well-known index. As a result, they frequently contemplate purchasing larger companies that are part of the applicable benchmark index.
TransAlta Renewables has institutional investors, as seen by the fact that they own a significant amount of the company’s stock.
This shows a level of trustworthiness among professional investors. But we can’t rely only on that fact, because institutions, like everyone else, make bad investments from time to time. There’s always the risk of being in a ‘crowded trade’ when many institutions own a company. When a trade goes bad, numerous parties may scramble to sell stock as quickly as can. This danger is greater in a company that has never grown before. TransAlta Renewables’ historical earnings and revenue are shown below, but there’s always more to the tale.
Hedge funds do not own TransAlta Renewables.
TransAlta Corporation, the firm’s major stakeholder, owns 60% of the corporation. This indicates that they have a majority stake in the company’s future. The second and third largest shareholders, on the other hand, own 1.2 percent and 1.2 percent of the outstanding shares, respectively.
While researching institutional ownership for a firm can be beneficial, it’s also a good idea to look at analyst recommendations to gain a better understanding of a stock’s predicted performance. There are a lot of analysts covering the stock, so you can readily look at forecast growth.
Insider Ownership Of TransAlta Renewables
Insider ownership is beneficial when it indicates that the company’s leaders are acting as actual owners. High insider ownership, on the other hand, might give a tiny group within the corporation enormous power. In some cases, this can be detrimental.
According to our research, TransAlta Renewables Inc. insiders own less than 1% of the company. Keep in mind that this is a large corporation, and insiders possess CA$1.1 million in stock. It’s possible that the absolute value is more relevant than the proportionate share. It’s encouraging to see board members owning stock, but it’s worth double-checking to determine if those insiders have been buying.
General Public Ownership
With a 29 percent stake in the corporation, the general people will not be easily disregarded. While this level of ownership may not be sufficient to swing a policy choice in their favor, individuals can nevertheless have an impact on corporate policies as a group.
Public Company Ownership
60 percent of TransAlta Renewables’ shares is held by public corporations. It’s difficult to determine for sure, although it’s possible they have overlapping business interests. This could be a key stake, so keep an eye out for any changes in ownership.
Next Steps:
I find it fascinating to investigate who owns a corporation. However, in order to fully obtain understanding, we must also analyze additional data. Take, for example, hazards. Every company has them, and we’ve identified four for TransAlta Renewables that you should be aware of (one of which doesn’t sit well with us!).
This free research on analyst forecasts is a must-read for anybody interested in learning what experts are forecasting for future growth.
NB: The figures in this article are based on data from the previous twelve months, which refers to the 12-month period that ended on the final day of the month in which the financial statement was issued. This could differ from the data in the annual report for the entire year.
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Is Trswf a good investment?
TransAlta Renewables Inc can be a beneficial investment option if you’re seeking for high-yielding stocks. The “TRSWF” stock price estimate for 2026-11-13 is 32.893 USD, based on our forecasts of a long-term growth. The revenue is estimated to be around +116.55 percent after a 5-year investment.
What is TransAlta?
In Canada, the United States, and Australia, TransAlta owns, operates, and develops a wide array of electrical power producing assets. We provide clean, cheap, and reliable power to our customers as one of Canada’s largest wind generators and Alberta’s largest hydroelectric power producer.
What dividend does Trswf pay?
As of December 7, 2021, the current dividend distribution for stock TransAlta Renewables Inc. (TRSWF) is 0.74 USD. TRSWF has a forward dividend yield of 5.18 percent as of December 7, 2021. For the previous three years, the average dividend growth rate for TransAlta Renewables Inc. (TRSWF) has been 3.43 percent.
When did Calgary power become TransAlta?
From 1980 to 1989, We officially changed our name to TransAlta in 1981, a name that better reflected our now province-wide operations, which had grown to supply 81% of Alberta’s electrical needs by the end of the decade.
What are the best Canadian banks to invest in?
If the Royal Bank of Canada is the “monarch,” TD is without a doubt the “prince.” It is the second-largest bank in terms of market capitalization and branch count (1,091 in Canada). With a 10-year CAGR of roughly 9.86 percent, TD is likewise extremely close to Royal Bank’s growth rate. If you compare the dividend yields of the two companies right now, TD may be the superior choice.
TD also has a higher dividend growth rate than the other banks on this list. Its dividend CAGR over the past 25 years has been around 11.3 percent. Furthermore, because its stock is less expensive than that of other banks ($64.5 per share at the time of writing), you will receive more shares for the same amount of money invested, and a faster dividend growth rate will ensure that dividend increases benefit you more.
On this list, TD Bank is also the most American bank. The United States accounted for around two-thirds of its premium retail earnings in 2019. Although it does not have the same global reach as Royal Bank, TD can compete with the larger brother in North America. With nearly 2,300 locations, it is the fifth-largest bank in North America (by branch count). It has a huge digital footprint, with 13 million users and increasing.
It outnumbers almost all other banks on this list in terms of total clientele, serving almost 26 million people worldwide. The digital front at TD is a standout feature since it’s the future frontier in banking, and if it’s leading the way, it’ll likely be able to develop its company much quicker than other banks in the country. This might result in higher dividends and faster capital growth, which would benefit the company’s investors.
Is dividend better than salary?
Dividends are a portion of a company’s profits distributed to shareholders as a return on their investment. To pay dividends, unlike paying salary, the company must make a profit (after taxes). Because investment income is not subject to national insurance, it is frequently a more tax-efficient way to take money from your business than collecting a salary.
Dividends are tax-free for the first £2,000 every year, after which they are taxed at either 7.5 percent or 32.5 percent (2020/21) depending on your other income. Dividends can only be paid to shareholders as a compensation for taking on the risk of investing. Dividends are not paid to directors who are not stockholders.
