emera
Toronto symbol EMA, generates and distributes electricity to customers in Nova Scotia and Bangor, Maine.
As is the case with TransCanada (see page 71), fears of higher interest rates have hurt these four power utilities. However, their high quality, mostly regulated operations will keep giving them plenty of steady cash flows for dividends.
CANADIAN UTILITIES LTD....
CANADIAN UTILITIES LTD....
EMERA INC. $35 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 131.0 million; Market cap: $4.6 billion; Price-to-sales ratio: 2.2; Dividend yield: 4.0%; TSINetwork Rating: Average; www.emera.com) gets 60% of its revenue and 50% of its earnings from Nova Scotia Power Inc., which is that province’s main electricity supplier. It also holds interests in electrical utilities in the U.S. and the Caribbean. Other operations include the Brunswick pipeline, which pumps natural gas from the U.S. to a liquefied natural gas plant in New Brunswick.
The Newfoundland government recently approved a new hydroelectric project on Labrador’s Churchill River. Emera will participate in this operation by paying $600 million for a 29% stake in a new regulated utility that will transmit power from Churchill River to the island of Newfoundland. In addition, Emera will spend $1.5 billion to build an undersea cable (called the Maritime Link) that will transmit 20% of the plant’s power to Nova Scotia. Emera will own 100% of this cable. These two projects should begin operating by 2017.
Meanwhile, Emera earned $220.8 million in 2012, down 8.4% from $241.1 million in 2011. Due to more shares outstanding, earnings per share fell at a faster pace of 10.7%, to $1.76 from $1.97.
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The Newfoundland government recently approved a new hydroelectric project on Labrador’s Churchill River. Emera will participate in this operation by paying $600 million for a 29% stake in a new regulated utility that will transmit power from Churchill River to the island of Newfoundland. In addition, Emera will spend $1.5 billion to build an undersea cable (called the Maritime Link) that will transmit 20% of the plant’s power to Nova Scotia. Emera will own 100% of this cable. These two projects should begin operating by 2017.
Meanwhile, Emera earned $220.8 million in 2012, down 8.4% from $241.1 million in 2011. Due to more shares outstanding, earnings per share fell at a faster pace of 10.7%, to $1.76 from $1.97.
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Low interest rates continue to spur demand for high-quality dividend-paying stocks, such as these four electrical utilities. We like the outlook for all of them, but only three are buys right now.
CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] $79 and CU.X [class B voting] $79; Income Portfolio, Utilities sector; Shares outstanding: 128.6 million; Market cap: $10.1 billion; Price-to-sales ratio: 3.2; Dividend yield: 2.5%; TSINetwork Rating: Above A v e r a g e ; www.canadianutilities.com) distributes electricity and natural gas in Alberta....
CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] $79 and CU.X [class B voting] $79; Income Portfolio, Utilities sector; Shares outstanding: 128.6 million; Market cap: $10.1 billion; Price-to-sales ratio: 3.2; Dividend yield: 2.5%; TSINetwork Rating: Above A v e r a g e ; www.canadianutilities.com) distributes electricity and natural gas in Alberta....
ALGONQUIN POWER & UTILITIES CORP. $7.63 (Toronto symbol AQN; Shares outstanding: 175.0 million; Market cap: $1.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.2%; www.algonquinpower.com) has received approval from regulators to complete its purchase of a natural gas distribution utility in Georgia for $147.0 million U.S.
This utility serves 64,000 consumers....
This utility serves 64,000 consumers....
ALGONQUIN POWER & UTILITIES CORP. $7.63 (Toronto symbol AQN; Shares outstanding: 175.0 million; Market cap: $1.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.2%; www.algonquinpower.com) has received approval from regulators to complete its purchase of a natural gas distribution utility in Georgia for $147.0 million U.S.
This utility serves 64,000 consumers. The purchase is scheduled to close on April 1, 2013.
Algonquin will borrow funds to pay for 50% of this business and will issue shares for the other 50%. Emera which is a recommendation of The Successful Investor, our conservative growth advisory, will buy enough of these new shares to keep its interest in Algonquin at 19.9%.
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This utility serves 64,000 consumers. The purchase is scheduled to close on April 1, 2013.
Algonquin will borrow funds to pay for 50% of this business and will issue shares for the other 50%. Emera which is a recommendation of The Successful Investor, our conservative growth advisory, will buy enough of these new shares to keep its interest in Algonquin at 19.9%.
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ALGONQUIN POWER & UTILITIES CORP. $7.42 (Toronto symbol AQN; Shares outstanding: 169.0 million; Market cap: $1.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.2%; www.algonquinpower.com) holds interests in 20 hydroelectric plants in Canada and the northeastern U.S. It also owns seven thermal energy facilities and five wind farms.
Algonquin’s subsidiary, Liberty Utilities, has operations in Arizona, California, Illinois, Iowa, Missouri, New Hampshire and Texas. These include 21 water-distribution and sewage-treatment plants, as well as four natural gas and two electricity distribution operations with over 257,000 customers.
Emera (Toronto symbol EMA), which is a recommendation of The Successful Investor, our conservative growth advisory, holds a 19.9% interest in Algonquin.
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Algonquin’s subsidiary, Liberty Utilities, has operations in Arizona, California, Illinois, Iowa, Missouri, New Hampshire and Texas. These include 21 water-distribution and sewage-treatment plants, as well as four natural gas and two electricity distribution operations with over 257,000 customers.
Emera (Toronto symbol EMA), which is a recommendation of The Successful Investor, our conservative growth advisory, holds a 19.9% interest in Algonquin.
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ALGONQUIN POWER & UTILITIES CORP. $7.42 (Toronto symbol AQN; Shares outstanding: 169.0 million; Market cap: $1.3 billion; TSINetwork Rating: Extra Risk; Dividend yield: 4.2%; www.algonquinpower.com) holds interests in 20 hydroelectric plants in Canada and the northeastern U.S....
EMERA INC. $35 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 124.7 million; Market cap: $4.4 billion;Price-to-sales ratio: 2.1; Dividend yield: 4.0%; TSI Network Rating:Average; www.emera.com) is buying a biomass plant in Brooklyn,Nova Scotia, from that province’s government. This facility generates power by burning waste wood from nearby lumber mills.
Emera will pay $25 million for the plant when the deal closes in early 2013. That’s equal to 56% of the $44.7 million, or $0.36 a share, that it earned in the third quarter of 2012.
The company gets most of its power from coal-burning plants, so investing in renewable power facilities like this one will help it comply with tougher environmental regulations.
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Emera will pay $25 million for the plant when the deal closes in early 2013. That’s equal to 56% of the $44.7 million, or $0.36 a share, that it earned in the third quarter of 2012.
The company gets most of its power from coal-burning plants, so investing in renewable power facilities like this one will help it comply with tougher environmental regulations.
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EMERA INC. $35 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 124.7 million; Market cap: $4.4 billion;Price-to-sales ratio: 2.1; Dividend yield: 4.0%; TSI Network Rating:Average; www.emera.com) is buying a biomass plant in Brooklyn,Nova Scotia, from that province’s government....
TORSTAR CORP., $8.15, Toronto symbol TS.B, fell 8% this week after it reported lower-than-expected earnings. The company continues to see weak advertising demand at its newspapers, including its flagship paper, The Toronto Star. Strong competition and unfavourable foreign exchange rates are also hurting profits at its Harlequin book publishing subsidiary. As a result, Torstar’s earnings fell 44.1% in the three months ended September 30, 2012, to $14.1 million, or $0.18 a share, from $25.2 million, or $0.32 a share, a year earlier....