Pls comment on Northland Power quarterly earning report and future prospects.
Very surprised they cut the annual dividend to 0.72 from 1.20.
I own this stock in my income portfolio,
Would you hold or sell?
Thanks for your advice.
NPI reported an EPS loss of $1.58 (GAAP earnings). Adjusted estimate was 12c. Revenue of $554M beat estimates of $525M. EBITDA of $256.9M missed estimates by 2%. The dividend was cut by 40%. EBITDA rise 13%. Sales also rose 13%. Guidance was largely unchanged. Free cash flow per share was 17c vs 8c last year. The loss relates to an impairment expense and was non-cash. Considering that free cash flow increase, the dividend cut is surprising and investors will not be happy. The company says that it wants to 'maintain financial flexibility' for 'growth initiatives'. But the amount the company will save on dividends is not hugely material to NPI. We would HOLD, for now, to see where the fallout from this levels off. But the shift is not overly encouraging. The stock before Thursday is up 40% this year and we are sure it will take a hit on this news.