Is it a good company at a reasonable price? This stock has done well for its shareholders in the past. I think that the P/E Ratio for this utility is rather high. They seem to be growing by acquisitions. There are some analysts that think it is overpriced. I tend to agree with them. My testing is certainly showing that the stock price is expensive.
I do not own this stock of Capital Power Corp (TSX-CPX, OTC-CPRHF). Capital power Corp is in John Heinzl's yield Hog model portfolio. In Money Sense annual list of the 100 best dividend stocks for 2021, this stock was rated an A.
When I was updating my spreadsheet, I noticed that the number of shares for this company went up almost 18% in 2024. They sold more shares in 2025. It is interesting that the CEO owns no shares and he has been CEO since 2023.
If you had invested in this company in December 2014, for $1,014.00 you would have bought 39 shares at $26 per share. In December 2024, after 10 years you would have received $750.04 in dividends. The stock would be worth $2,2485.08. Your total return would have been $3,235.12. This would be a total return of 14.30% per year with 9.38% from capital gain and 4.92% from dividends.
| Cost | Tot. Cost | Shares | Years | Dividends | Stock Val | Tot Ret |
|---|---|---|---|---|---|---|
| $26.00 | $1,014.00 | 39 | 10 | $750.04 | $2,485.08 | $3,235.12 |
The current dividend yield is moderate with dividend growth low. The current dividend yield is moderate (2% to 4% range at 4.83%. The 5, 10 and historical dividend yields are good (5% to 6% ranges) at 5.33%, 6.27% and 5.63%. The dividends are increasing at a low rate (below 8% per year) at 6% per year over the past 5 years. The last dividend increase was in 2025 and it was for 6%.
The Dividend Payout Ratios (DPR) are mostly good. The DPR for 2024 for Earnings per Share (EPS) is good at 48% with 5 year coverage too high at 84%. The DPR for 2024 for Adjusted Earnings per Share (AEPS) is good at 49% with 5 year coverage too high at 83%. The DPR for 2024 for Cash Flow per Share (CFPS) is good at 33% with 5 year coverage at 27%. The DPR for 2024 for Free Cash Flow (FCF) is non-calculable due to a negative FCF with 5 year coverage at 240%. There is no agreement on what the FCF and in 2024 they range from $74M to a negative $160M.
| Item | Cur | 5 Years |
|---|---|---|
| EPS | 48.48% | 84.24% |
| AEPS | 48.52% | 82.88% |
| AFFO | 39.38% | 36.32% |
| CFPS | 32.83% | 27.24% |
| FCF | -216.89% | 240.35% |
Debt Ratios are showing that this stock has a lot of debt. The Long Term Debt/Market Cap Ratio for 2024 is fine at 0.60 and currently good at 0.55. However, we need also to look at the Long Term Debt/Covering Assets Ratio for 2024 which is fine at 0.66 and currently at 0.63 because this is a more important ratio for a Utility. The Liquidity Ratio for 2024 is fine at 1.44 and far too low at 0.88 currently. If you added in Cash Flow after dividends, the ratios are fine at 1.82 and currently low at 1.34. The Debt Ratio for 2024 is good at 1.55 and fine at 1.48 currently. The Leverage and Debt/Equity Ratios for 2024 are too high at 3.38 and 2.19 and currently at 3.83 and 2.59.
| Type | Year End | Ratio Curr |
|---|---|---|
| Lg Term R | 0.60 | 0.55 |
| Lg Term /A | 0.66 | 0.63 |
| Intang/GW | 0.08 | 0.10 |
| Liquidity | 1.44 | 0.88 |
| Liq. + CF | 1.82 | 1.34 |
| Debt Ratio | 1.55 | 1.48 |
| Leverage | 3.38 | 3.83 |
| D/E Ratio | 2.19 | 2.59 |
The Total Return per year is shown below for years of 5 to 15 to the end of 2024. 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. |
|---|---|---|---|---|---|
| 2019 | 5 | 6.12% | 18.20% | 13.13% | 5.08% |
| 2014 | 10 | 6.66% | 14.30% | 9.38% | 4.92% |
| 2009 | 15 | 4.67% | 12.30% | 7.56% | 4.75% |
The 5-year low, median, and high median Price/Earnings per Share Ratios are 26.49, 38.42 and 50.35. The corresponding 10 year ratios are 21.89, 26.70 and 32.57. The corresponding historical ratios are 21.89, 25.56 and 28.67. The current P/E Ratio is 34.36 based on a stock price of $57.27 and EPS estimate for 2025 of $1.67. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I also have Adjusted Earnings per Share (AEPS) data. The 5-year low, median, and high median Price/Adjusted Earnings per Share Ratios are 10.31, 12.26 and 14.21. The corresponding 10 year ratios are 15.53, 18.81 and 22.29. The corresponding historical ratios are 16.43, 18.83 and 21.92. The current P/AEPS Ratio is 29.22 based on a stock price of $57.27 and EPS estimate for 2025 of $1.96. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I also have Adjusted Funds from Operations (AFFO) data. The 5-year low, median, and high median Price/ Adjusted Funds from Operations Ratios are 5.16, 6.13 and 7.82. The corresponding 10 year ratios are 5.16, 6.27 and 7.50. The corresponding historical ratios are 5.10, 5.97 and 6.82. The current P/AEPS Ratio is 9.30 based on a stock price of $57.27 and AFFO estimate for 2025 of $6.16. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I get a Graham Price of $29.88. The 10-year low, median, and high median Price/Graham Price Ratios are 0.93, 1.11 and 1.23. The current P/GP Ratio is 1.92 based on a stock price of $57.27. The current ratio is above the high ratio of the 10 year median ratios. This stock price testing suggests that the stock price is relatively expensive.
I get a 10-year median Price/Book Value per Share Ratio of 1.57. The current P/B Ratio is 2.83 based on Book Value of $$3,125, Book Value per Share of $20.25 and a stock price of $57.27. The current ratio is 80% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get a 10-year median Price/Cash Flow per Share Ratio of 5.41. The current ratio is 6.69 based on Cash Flow per Share estimate for 2025 of $8.56, Cash Flow of $1,320M and a stock price of $57.27. The current ratio is 24% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
I get an historical median dividend yield of 5.63%. The current dividend yield is 4.83% based on dividends of $2.50 and a stock price of $57.27. The current ratio is 14% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively reasonable but above the median.
I get a 10 year median dividend yield of 6.27%. The current dividend yield is 4.83% based on dividends of $2.50 and a stock price of $57.27. The current ratio is 23% below the historical median dividend yield. This stock price testing suggests that the stock price is relatively expensive.
The 10-year median Price/Sales (Revenue) Ratio is 1.72. The current P/S Ratio is 2.69 based on Revenue estimate for 2025 of $3,280M, Revenue per Share of $21.25 and a stock price of $57.27. The current ratio is 57% above the 10 year median ratio. This stock price testing suggests that the stock price is relatively expensive.
Results of stock price testing is that the stock price is probably expensive. The 10 year median dividend yield test is saying that the stock price is relatively expensive. This is confirmed by the P/S Ratio test. Almost all the testing, expect for the historical median dividend yield test is saying that the stock price is expensive. If you look at this stock chart, it is just off its latest high.
When I look at analysts’ recommendations, I find Strong Buy (4), Buy (4), Hold (2) and Sell (1). The consensus would be a Buy. The 12 month stock price consensus is $64.55 with a high of $75.00 and low of $48.00. The stock price consensus implies a total return of 17.54% with 12.71% from capital gains and 4.83% from dividends.
Analysts on Stock Chase have different views. Some think it is Buy, while others think it is a partial sell because it has taken off on speculation. Amy Legate-Wolfe on Motley Fool thinks you should buy for passive income after this stock has taken off. Puja Tayal on Motley Fool says to invest in Energy stocks for dividends and solid returns. The company put out a Press Release about their fourth quarter of 2024. The company put out a Press Release about their second quarter of 2025.
Simply Wall Street via Yahoo Finance talks about this company’s second quarter and the fact that Revenues fell badly short of expectations. Simply Wall Street has 4 warnings out on this stock of interest payments are not well covered by earnings; shareholders have been diluted in the past year; large one-off items impacting financial results; and dividend of 4.83% is not well covered by free cash flows.
Capital Power Corp is a North American power producer whose principal activities are developing, acquiring, and operating power plants. Through its subsidiary, Capital Power owns and operates a portfolio of natural gas, coal, wind, solar, and solid fuel energy generating facilities. These are located throughout Western and Central Canada and the U.S. Capital Power's natural gas and coal facilities. Its web site is here Capital Power Corp.
The last stock I wrote about was about was ATCO Ltd (TSX-ACO.X, OTC-ACLLF) ... learn more. The next stock I will write about will be Boralex Inc (TSX-BLX, OTC-BRLXF) ... learn more on Friday, September 5, 2025 around 5 pm. Tomorrow on my other blog I will write about Something to Buy September 2025.... .... learn more on Thursday, September 4, 2025 around 5 pm.
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