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4 Reasons to Invest in Algonquin Power for Portfolio Boost

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Algonquin Power & Utilities Corp.’s (AQN - Free Report) earnings estimates have been revised upward over the past 60 days, reflecting analysts’ confidence in the stock. The Zacks Consensus Estimate for 2018 and 2019 earnings has moved 8.2% and 1.7% north to 66 cents and 60 cents per share, respectively, within the same time frame.

Algonquin Power, currently a Zacks Rank #2 (Buy) stock, is the owner and operator of a portfolio of regulated and non-regulated generation, distribution and transmission utility assets.

Let’s focus on the factors that make Algonquin Power a stock to bet on for obtaining greater returns.

Price Appreciation: In the past four months, shares of Algonquin Power have gained 3% compared with the industry’s growth of 2.6%.



Earnings Result and Surprise Trend: Algonquin Power delivered second-quarter 2018 earnings of 11 cents per share from continuing operations, surpassing the Zacks Consensus Estimate of 9 cents by 22.2%. The company also boasts an impressive earnings surprise history, pulling off a positive earnings surprise in all the last four quarters with an average beat of 36.4%.

Capital Investments: The company incurred nearly $3.9 billion of capex in 2017. It tweaked its capital outlay guidance for 2018 from $1.3-$1.4 billion to $1.3-$1.5 billion. The company consistent capex pan will strengthen the operations of the company. Apart from extending its green asset fleet domestically, Algonquin Power is planning to widen its presence internationally.

Global Expansion: On Mar 9, 2018, Algonquin Power announced that it has acquired 25% interest in Atlantica Yield (AY - Free Report) for $608 million. On Apr 17, 2018, Algonquin Power further exercised its right to purchase an additional 16.5% stake for $345 million in Atlantica Yield.  The company’s joint venture AAGES with Spain-based Abengoa S.A. will support its goal to broaden international business activities.

Other Stocks to Consider

Other top-ranked stocks in the same industry include Ameren Corporation (AEE - Free Report) and CMS Energy Corporation (CMS - Free Report) , each holding a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Ameren pulled off an average four-quarter positive earnings surprise of 7.69%. The Zacks Consensus Estimate for 2018 has moved 5.6% up over the past 30 days to $3.21 per share. Its bottom line is expected to grow 6.6% over the long-term (3-5 year) period.

CMS Energy delivered an average four-quarter positive earnings surprise of 8.67%. The Zacks Consensus Estimate for 2018 has been revised 0.4% upward over the past 30 days to $2.34 per share. The company’s bottom line is projected to increase 6.2% over the long-term period.

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