TransAlta Corporation (NYSE:TAC) Receives Consensus Recommendation of "Moderate Buy" from Brokerages

Key Points

• Analysts assign TransAlta a “Moderate Buy” consensus rating: Six of nine brokerages recommend buying the stock, one rates it a strong buy, one recommends holding, and one recommends selling. The average 12-month price target is $24.50.
• Institutional investors and hedge funds own approximately 59% of TransAlta’s shares, with Bank of America adding a new position worth about $123.4 million in the second quarter.
• TransAlta reported quarterly EPS of $0.13, exceeding the $0.11 consensus estimate, although revenue of $342.85 million fell short of expectations. The company declared a quarterly dividend of $0.07, equivalent to a 2.3% annualized yield.

TransAlta Corporation (NYSE:TAC - Get Free Report) TSE: TA has been assigned an average rating of "Moderate Buy" from the nine brokerages that are presently covering the company, Marketbeat Ratings reports. One research analyst has rated the stock with a sell recommendation, one has issued a hold recommendation, six have issued a buy recommendation and one has issued a strong buy recommendation on the company. The average 1-year target price among brokerages that have issued ratings on the stock in the last year is $24.50.

A number of analysts have recently weighed in on TAC shares. Canadian Imperial Bank of Commerce reaffirmed an "outperform" rating on shares of TransAlta in a research note on Friday, July 17th. Weiss Ratings lowered shares of TransAlta from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Tuesday, August 18th. TD Cowen assumed coverage on TransAlta in a report on Wednesday, June 10th. They set a "buy" rating on the stock. Scotiabank upgraded TransAlta to a "strong-buy" rating in a research report on Wednesday, June 10th. Finally, Zacks Research raised TransAlta from a "strong sell" rating to a "hold" rating in a research note on Monday, August 17th.

Institutional Inflows and Outflows

Hedge funds have recently bought and sold shares of the company. Bank of America Corp DE bought a new stake in TransAlta in the second quarter worth about $123,434,000. Norges Bank bought a new position in shares of TransAlta during the 4th quarter valued at about $45,298,000. Sculptor Capital LP bought a new position in shares of TransAlta during the 4th quarter valued at about $37,958,000. Value Aligned Research Advisors LLC acquired a new position in shares of TransAlta in the 1st quarter worth approximately $34,128,000. Finally, Cibc World Market Inc. acquired a new position in shares of TransAlta in the 2nd quarter worth approximately $31,799,000. 59.00% of the stock is owned by institutional investors and hedge funds.

TransAlta Price Performance

Shares of NYSE TAC opened at $12.28 on Friday. The stock has a market cap of $3.88 billion, a P/E ratio of -68.22 and a beta of 0.70. The firm's 50-day simple moving average is $12.66 and its 200 day simple moving average is $13.00. TransAlta has a fifty-two week low of $11.38 and a fifty-two week high of $17.88. The company has a quick ratio of 0.77, a current ratio of 0.84 and a debt-to-equity ratio of 3.64.

TransAlta (NYSE:TAC - Get Free Report) TSE: TA last announced its earnings results on Friday, July 31st. The utilities provider reported $0.13 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.11 by $0.02. The firm had revenue of $342.85 million during the quarter, compared to analyst estimates of $379.54 million. TransAlta had a negative net margin of 2.76% and a positive return on equity of 8.85%. Equities analysts expect that TransAlta will post 0.21 EPS for the current year.

TransAlta Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, October 1st. Stockholders of record on Tuesday, September 1st will be issued a $0.07 dividend. The ex-dividend date is Tuesday, September 1st. This represents a $0.28 annualized dividend and a dividend yield of 2.3%. TransAlta's dividend payout ratio is -111.11%.

About TransAlta

TransAlta Corporation is a Canada-based power generation and wholesale marketing company headquartered in Calgary, Alberta. The company develops, owns and operates electricity-generating facilities and provides power to utilities, commercial and industrial customers, and wholesale markets.

TransAlta's generation portfolio includes hydroelectric, natural gas, wind, solar and battery storage facilities. The company has also historically operated coal-fired power plants and has been transitioning its generation fleet toward lower-emission sources, including renewable energy and natural gas.

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