INNERGEX RENEWABLE ENERGY $11.65 (Toronto symbol INE; Shares outstanding: 101.1 million; Market cap: $1.2 billion; TSINetwork Rating: Extra Risk; Dividend yield 5.3%; www.innergex.com) operates 26 hydroelectric plants, six wind farms and one solar power facility in Quebec, Ontario, B.C. and Idaho. The company gets 73% of its power from hydroelectric plants. Wind supplies 26% and solar generates 1%.
In contrast to Algonquin, Innergex is growing slowly, mostly by building its own hydroelectric and wind facilities, rather than through acquisitions. Right now, the company has five projects under construction.
But like Algonquin, Innergex makes sure it has firm long-term power-purchase contracts in place before it starts building new plants.
In the three months ended March 31, 2015, Innergex’s revenue jumped 53.5%, to $57.7 million from $37.6 million a year earlier. Rainfall was well above average in the latest quarter and well below average in the year-ago period. Cash flow rose 61.5%, to $0.42 a share from $0.26.
The stock trades at 10.2 times Innergex’s forecast 2015 cash flow of $1.14 a share. It yields 5.3%.
Innergex Renewable Energy is a buy.
