Is it a good company at a reasonable price? This stock has not been doing well, but they are making a lot of changes. Some analysts feel that this stock will be a good investment because of the changes being made and especially the change to a pure-play regulated utility. There is a risk here. On the other hand, the stock is cheap. If you buy cheap stocks, there is always a bigger risk that when buying stock that is at a reasonable price.
I do not own this stock of Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN). This is a dividend paying utility stock. I got it off a list of dividend paying utility stocks. Also, I own Emera Inc. and this company owns shares in Algonquin Power.
When I was updating my spreadsheet, I noticed there seems to be a change in the directors and management. I follow a few directors and officers and two of the directors I was following and two of the officers I was following are gone. This is unusual. Sometimes there is one people gone, but not generally two directors and two officers.
If you had invested in this company in December 2015, for $1,003.72 CDN$ you would have bought 92 shares at $10.91 per share. In December 2025, after 10 years you would have received $608.50 in dividends. The stock would be worth $776.48. Your total return would have been $1,384.98. This would be a total return of 4.21% per year with 2.53% from capital loss and 6.47% from dividends. This is in CDN$.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $10.91 | $1,003.72 | 92 | 10 | $608.50 | $776.48 | $1,384.98 |
If you had invested in this company in December 2015, for $1,000.76 US$ you would have bought 127 shares at $7.88 per share. In December 2025, after 10 years you would have received $635.18 in dividends. The stock would be worth $781.05. Your total return would have been $1,416.23. This would be a total return of 4.59% per year with 2.45% from capital loss and 7.04% from dividends. This is in US$.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $7.88 | $1,000.76 | 127 | 10 | $635.18 | $781.05 | $1,416.23 |
The current dividend yield is moderate with dividend growth negative. The current dividend yield is moderate (2% to 4% ranges) at 4.40%. The 5 year dividend yield is good (5% to 6% ranges) at 6.24%. The 10 year and historical median dividend yields are moderate at 4.79% and 4.91%. Dividends were cut in 2022 and 2023. They have been flat since then. Dividend were just over 40%. Analysts expect dividends to increase slightly in 2028.
The Dividend Payout Ratios (DPR) need improving. The DPR for 2025 for Earnings per Share (EPS) is far too high at 118% with 5 year coverage non-calculable due to earning losses. The DPR for 2025 for Adjusted Earnings per Share (AEPS) is too high at 76% with 5 year coverage also too high at 99%. The DPR for 2025 for Cash Flow per Share (CFPS) is good at 31% with 5 year coverage is high at 47%. The DPR for 2025 for Adjusted Funds from Operations (AFFO) is good at 34% with 5 year coverage at 47%. The DPR for 2025 for Free Cash Flow (FCF) is non-calculable due to negative FCF with 5 year coverage non-calculable due to negative FCF. FCF varied in 2025 for a negative $133M to a negative $182M.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 118.18% | -148.35% |
| AEPS | 76.47% | 99.15% |
| CFPS | 31.24% | 46.67% |
| AFFO | 33.83% | 49.37% |
| FCF | -151.81% | -92.86% |
Debt Ratios need improving and the company has too much debt. The Long Term Debt/Market Cap Ratio for 2025 is far too high at 1.31 and currently at 1.36. The Liquidity Ratio for 2025 is too low at 1.00 and 1.05 currently. If you added in Cash Flow after dividends, the ratios are still low at 1.333 and currently at 1.47. The Debt Ratio for 2025 is good at 1.56 and 1.56 currently. The Leverage and Debt/Equity Ratios for 2025 are too high at 3.17 and 2.04 and currently at 3.14 and 2.01.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term | 1.31 | 1.36 |
| Intang/GW | 0.29 | 0.31 |
| Liquidity | 1.00 | 1.05 |
| Liq. + CF | 1.33 | 1.47 |
| Debt Ratio | 1.56 | 1.56 |
| Leverage | 3.17 | 3.14 |
| D/E Ratio | 2.04 | 2.01 |
The Total Return per year is shown below for years of 5 to 28 to the end of 2025 in CDN$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | -13.92% | -12.18% | -16.63% | 4.44% |
| 2015 | 10 | -3.50% | 4.21% | -2.53% | 6.74% |
| 2010 | 15 | 3.93% | 11.65% | 3.52% | 8.13% |
| 2005 | 20 | -4.63% | 4.88% | -1.06% | 5.95% |
| 2000 | 25 | -3.93% | 6.44% | -0.72% | 7.16% |
| 1997 | 28 | -3.10% | 6.71% | -0.76% | 7.47% |
The Total Return per year is shown below for years of 5 to 22 to the end of 2025 in US$. Under the Capital Gain column is the portion of the Total Return attributable to capital gains. Under the Dividend column is the portion of the Total Return attributable to dividends. See chart below.
| From | Years | Div. Gth | Tot Ret | Cap Gain | Div. |
|---|---|---|---|---|---|
| 2020 | 5 | -15.18% | -13.56% | -17.87% | 4.31% |
| 2015 | 10 | -3.40% | 4.59% | -2.45% | 7.04% |
| 2010 | 15 | 1.73% | 8.81% | 1.34% | 7.48% |
| 2005 | 20 | -5.40% | 4.31% | -1.87% | 6.17% |
| 2003 | 22 | -4.47% | 5.91% | -1.26% | 7.16% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 20.33, 24.84 and 29.35. The corresponding 10 year ratios are 21.97, 25.32 and 28.12. The corresponding historical ratios are 23.61, 27.13 and 29.84. The current ratio is 17.40 based on a stock price of $8.40 and EPS estimate for 2026 of $0.48 ($0.34 US$). The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in CDN$.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Earnings per Share Ratios are 12.56, 16.31 and 22.50. The corresponding 10 year ratios are 14.37, 17.54 and 22.55. The corresponding historical ratios are 14.69, 22.68 and 14.69. The current ratio is 16.42 based on a stock price of $5.91 and EPS estimate for 2026 of $0.36. The current ratio is between the low ratio and median ratios of the 10 year median ratios. T This stock price testing suggests that the stock price is relatively reasonable and below the median. This testing is in US$. You will get a similar result in CDN$.
I get a Graham Price of $9.75. The 10-year low, median, and high median Price/Graham Price Ratios are 0.97, 1.09 and 1.34. The current ratio is 0.86 based on a stock price of $8.40. The current ratio is below the low ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively cheap. This testing is in CDN$.
I get a 10-year median Price/Book Value per Share Ratio of 1.62. The current ratio is 1.02 based on a stock price of $5.91, Book Value of $4,472M, and Book Value per Share of $5.82. The current ratio is 37% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$. You will get a similar result in CDN$.
I also have a Book Value per Share estimate for 2026 of $6.16 US$. The analyst calculates the Book Value differently that I do and, in this case, the 10 year median ratio is 1.54. The Book Value per Share estimate for 2026 of $6.16 implies a Book Value of $4,735M and a ratio of 0.96 with a stock price of $9.51. This ratio is 38% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$. You will get a similar result in CDN$.
I get a 10-year median Price/Cash Flow per Share Ratio of 10.11. The current ratio is 6.72 based on Cash Flow per Share estimate for 2026 of $0.88, Cash Flow of $676M and a stock price of $5.91. The current ratio is 34% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$. You will get a similar result in CDN$.
I get an historical median dividend yield of 4.91%. The current dividend yield is 4.40% based on dividends of $0.26 and a stock price $5.91. The current dividend yield is 10% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. A similar test in CDN$ show that the stock price is relatively cheap. This may not be a good test because of dividend cuts.
I get a 10 year median dividend yield of 4.79%. The current dividend yield is 4.40% based on dividends of $0.26 and a stock price $5.91. The current dividend yield is 8% below the 10 year median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median. This testing is in US$. You will get a similar result in CDN$. This may not be a good test because of dividend cuts.
The 10-year median Price/Sales (Revenue) Ratio is 2.80. The current ratio is 1.74 based on Revenue estimate for 2026 of $2,613M, Revenue per share of $3.40 and a stock price of $5.91. The current ratio is 38% below the 10 year median ratio. This stock price testing suggests that the stock price is relatively cheap. This testing is in US$. You will get a similar result in CDN$.
Results of stock price testing is that the stock price is probably cheap. The Dividend Yield tests are probably not good because of dividend cuts. The P/S Ratio testing is good and says that the stock price is relatively cheap. Most of the rest of the testing is saying that the stock price is either cheap or relatively reasonable and below the median. I did most of the testing in US$ as the financials are in US$ and the dividend is paid in US$.
When I look at analysts’ recommendations, I find Buy (5), and Hold (7). The consensus is Buy. The 12 month consensus stock price of $10.01 ($7.05 US$) with a high of $10.27 ($7.23 US$) and a low of $9.27($6.53 US$). The consensus stock price of $10.01 implies a total return of $23.57% with 19.18% from capital gains and 4.40% from dividends based on a current stock price of $8.40.
Interestingly, a number of analysts on Stock Chase thinks that they will be a good company now that they sold their renewable business. Christopher Liew on Motley Fool thinks this is a undervalued stock, but says be cautious mainly because the high DPRs. Jitendra Parashar on Motley Fool says you might want to consider this company because of its focus on being a pure-play regulated utility. The company put out a press release via Business Wire about their fourth quarter of 2025 results. The company put out a press release via Business Wire about their first quarter results for 2026.
Simply Wall Street via Yahoo Finance. Simply Wall Street says to own Algonquin today, you need to believe its shift to a pure-play regulated utility and “Back-to-Basics” plan can eventually translate into more stable, higher-quality earnings, despite low current returns on equity and operational growing pains. Simply Wall Street has two warnings of dividend of 4.39% is not well covered by earnings or free cash flows; and interest payments are not well covered by earnings.
Algonquin Power & Utilities Corp is a Canada-based diversified international generation, transmission, and distribution company. It operates in the United States, Canada, Bermuda, and Chile. Its web site is here Algonquin Power & Utilities Corp.
The last stock I wrote about was about was Sylogist Ltd (TSX-SYZ, OTC-SYZLF) ... learn more. The next stock I will write about will be Goeasy Ltd (TSX-GSY, OTC-EHMEF) ... learn more on Friday, June 26, 2026 around 5 pm. Tomorrow on my other blog I will write about 5 Dividend Stocks to Own.... learn more on Tuesday, June 23, 2016 around 5 pm.
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