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FNCE 3006: Group Assignment COMPANY ANALYSIS

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Added on  2019-09-18

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2.______________________________________ 3.______________________________________ 4.______________________________________ 5.______________________________________ EXECUTIVE SUMMARY: Introduction: The Algonquin Power & Utilities Corporation (APUC) is a North American renewable energy and well-controlled utility company with an operating asset of about $5 billion. The Algonquin Power Company has an equity interest in over 33 clean energy facilities that deals with solar, thermal, wind, and hydroelectric energy. This company has over 175,000 customers in wastewater treatment
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COMPANY ANALYSIS FNCE 3006: Group Assignment COMPANY NAME: ________________________________________________________ Group # ____________ Members: 1. ______________________________________. 2.______________________________________ 3.______________________________________ 4.______________________________________ 5.______________________________________ EXECUTIVE SUMMARY:
FNCE 3006: Group Assignment COMPANY ANALYSIS_1
Introduction:
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The Algonquin Power & Utilities Corporation (APUC) is a North American renewable energy and well-controlled utility company with an operating asset of about $5 billion. The corporation operates and acquires clean and green energy assets. These assets include the wind, solar power facilities, hydroelectric, and thermal. Also, the company provides sustainable utility distribution of natural gas, electricity, and water. APUC serves an extensive customer base of more than 564,000 consumers in America. The company has two fully functional subsidiaries, which are Liberty Utilities and Algonquin Power Company. The Algonquin Power Company has an equity interest in over 33 clean energy facilities that deals with solar, thermal, wind, and hydroelectric energy. The Liberty Utilities has more than 560,000 customers and serves 11 states in the United States. This company has over 175,000 customers in wastewater treatment and water distribution, 92,000 customers in electricity distribution, and 293,000 connections in natural gas distribution.APUC transmission group invests in a rate controlled electric transmission and pipeline systems of natural gas in Canada and the United States. APUC being the biggest utility company in North America, it commits itself to sustainability and development in economic, environmental, and social values. The company’s corporate responsibility programs serve to conserve, preserve, and improve the environment. The primary pillar of sustainability for the corporation is the planet. APUC prioritize in protecting the natural environment by funding various projects. The company’s market value as of 18th November 2016 was $2,926.74 million, and it is expected to grow in the future (Algonquin Power & Utilities Corporation). APUC has a projected growth of
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0.47%. The company’s instalment receipts, preferred shares, and common shares are traded on the Toronto Stock Exchange (TSE) under the symbols AQN.IR, AQN.PR.A, and AQN respectively. By investing in APUC, one is assured of great returns because the demand for the products the company offers is rapidly increasing. Profitability RatiosIn the past three years, AQN’s return on equity has augmented. Examining the DuPont Identity while considering operating efficiency, asset use efficiency, and financial leverage will explain this growth. Refer to EXHIBIT X for financial data.Profit MarginAQN’s profit margin gives insight to how efficiently they manage their operations. Comparatively, in AQN’s last two years of operations, the differences between revenuesand costs have been more significant than industry standards. With NPI’s abnormally high outlier ignored, even 2013’s profit margin for AQN is better than the industry average. In other words, through its efficient operations, AQN receives more bottom line than it’s competitors.Return on AssetsThe returns on book assets are favourable. Not only have the last two years been above the industry average, but since 2013 it has been growing. This is strength since asset usage is becoming more efficient. In 2015, about $0.10 of profit is made per dollar of asset owned compared to the $0.02 industry average. It is also important to note that the
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