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Clearway Energy Acquires Carlsbad, Expands Green Portfolio
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Clearway Energy, Inc. (CWEN - Free Report) announced that it has recently completed the acquisition of 527-megawatt (MW) Carlsbad Energy Center (Carlsbad) from Global Infrastructure Partners III (GIP) for $184 million. Clearway Energy issued 5.4-million shares of Class C common stock to fund the acquisition.
This facility will further boost the company’s clean power generation portfolio, which presently includes 7,000 MWs of wind, solar and natural gas-fired power generation facilities. The project’s power purchase and tolling agreement with San Diego Gas and Electric Company has 19 years remaining (with the total being 20 years). This agreement will ensure regular earnings from the project and boost the company’s bottom line.
Long-Term Agreement
Most of Clearway Energy’s generation assets substantially sell all of their output pursuant to long-term offtake agreements. The weighted average remaining contract duration of these long-term offtake agreements was nearly 14 years as of Sep 30, 2019.
Assets acquired by the company also have long-term power purchase agreements, which make these assets accretive to earnings and contribute to an increase in cash flows.
Acquisition and Disposition
Clearway Energy continues to acquire and dispose assets to create a portfolio that is in sync with long-term growth objectives. On May 1, 2019, the company — through its indirect subsidiary ECP Uptown Campus LLC — acquired the Duquesne University district energy system totaling 82 combined MWt, located in Pittsburgh, PA, for $107 million. As part of the acquisition, Duquesne University entered into a 40-year Energy Services Agreement in exchange for monthly capacity payments.
During the second half of 2019, the company disposed Energy Center Dover LLC and Energy Center Smyrna LLC assets to focus more on core operations.
Price Performance
Shares of Clearway Energy have outperformed its industry in the past 12 months.
Long-term earnings growth (three to five years) for Bloom Energy, Enbridge and World Fuel Services is pegged at 25%, 6.4% and 5%, respectively.
Bloom Energy, Enbridge and World Fuel Services delivered average positive surprise of 60.1%, 11.3% and 16.2%, respectively, in the last four quarters.
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Clearway Energy Acquires Carlsbad, Expands Green Portfolio
Clearway Energy, Inc. (CWEN - Free Report) announced that it has recently completed the acquisition of 527-megawatt (MW) Carlsbad Energy Center (Carlsbad) from Global Infrastructure Partners III (GIP) for $184 million. Clearway Energy issued 5.4-million shares of Class C common stock to fund the acquisition.
This facility will further boost the company’s clean power generation portfolio, which presently includes 7,000 MWs of wind, solar and natural gas-fired power generation facilities. The project’s power purchase and tolling agreement with San Diego Gas and Electric Company has 19 years remaining (with the total being 20 years). This agreement will ensure regular earnings from the project and boost the company’s bottom line.
Long-Term Agreement
Most of Clearway Energy’s generation assets substantially sell all of their output pursuant to long-term offtake agreements. The weighted average remaining contract duration of these long-term offtake agreements was nearly 14 years as of Sep 30, 2019.
Assets acquired by the company also have long-term power purchase agreements, which make these assets accretive to earnings and contribute to an increase in cash flows.
Acquisition and Disposition
Clearway Energy continues to acquire and dispose assets to create a portfolio that is in sync with long-term growth objectives. On May 1, 2019, the company — through its indirect subsidiary ECP Uptown Campus LLC — acquired the Duquesne University district energy system totaling 82 combined MWt, located in Pittsburgh, PA, for $107 million. As part of the acquisition, Duquesne University entered into a 40-year Energy Services Agreement in exchange for monthly capacity payments.
During the second half of 2019, the company disposed Energy Center Dover LLC and Energy Center Smyrna LLC assets to focus more on core operations.
Price Performance
Shares of Clearway Energy have outperformed its industry in the past 12 months.
Zacks Rank & Key Picks
Clearway Energy currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the same sector are Bloom Energy Corporation (BE - Free Report) , Enbridge Inc. (ENB - Free Report) and World Fuel Services Corporation , each currently holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth (three to five years) for Bloom Energy, Enbridge and World Fuel Services is pegged at 25%, 6.4% and 5%, respectively.
Bloom Energy, Enbridge and World Fuel Services delivered average positive surprise of 60.1%, 11.3% and 16.2%, respectively, in the last four quarters.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through Q3 2019, while the S&P 500 gained +39.6%, five of our strategies returned +51.8%, +57.5%, +96.9%, +119.0%, and even +158.9%.
This outperformance has not just been a recent phenomenon. From 2000 – Q3 2019, while the S&P averaged +5.6% per year, our top strategies averaged up to +54.1% per year.
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