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  5. TA: Please comment on the 3rd q earnings released today. [TransAlta Corporation]
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Q: Please comment on the 3rd q earnings released today. They seem to be way ahead of expectations but I realize in this business sector earnings are only part of the picture in determining if the company is worth iinvesting in.
Asked by Murray on November 09, 2023
5i Research Answer:

TA had a strong Q3 with year-over-year growth in total revenue up +9.47% to $1B, and EPS up +526% to $1.41. Cash from operations saw a significant year-over-year increase up +233.8% to $681M. TA displayed significant year-over-year growth in Q3 Gross Profit margin, Net Income margin, and EBITDA margin. TA also announced last week, a definitive agreement to acquire Heartland Generation Ltd. for $658M from Energy Capital Partners. The stock is trading at an attractive 10.2x earnings, while the strong Q3 paired with recent acquisition bodes well for future growth. It should also benefit from lower rates. Results were also well above estimates. It is not our favourite utility, and it has cut its dividend twice in the past decade, but this was certainly a good quarter.