TRANSALTA CORP (TAC) Stock Fundamental Analysis
USA - NYSE:TAC - CA89346D1078 - Common Stock
17.655 USD
+0.02 (+0.09%)
Taking everything into account, TAC scores 4 out of 10 in our fundamental rating. TAC was compared to 20 industry peers in the Independent Power and Renewable Electricity Producers industry. TAC has a medium profitability rating, but doesn't score so well on its financial health evaluation. TAC has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
TAC had negative earnings in the past year.
In the past year TAC had a positive cash flow from operations.
In multiple years TAC reported negative net income over the last 5 years.
In the past 5 years TAC always reported a positive cash flow from operatings.
1.2 Ratios
TAC has a worse Return On Assets (-1.87%) than 65.00% of its industry peers.
Looking at the Return On Equity, with a value of -10.58%, TAC is doing worse than 65.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 3.34%, TAC is in the better half of the industry, outperforming 70.00% of the companies in the same industry.
TAC had an Average Return On Invested Capital over the past 3 years of 8.64%. This is above the industry average of 4.08%.
The 3 year average ROIC (8.64%) for TAC is well above the current ROIC(3.34%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.87% | ||
| ROE | -10.58% | ||
| ROIC | 3.34% |
ROA(3y)3.11%
ROA(5y)-0.07%
ROE(3y)17.47%
ROE(5y)0.34%
ROIC(3y)8.64%
ROIC(5y)N/A
1.3 Margins
TAC's Profit Margin has improved in the last couple of years.
TAC has a Operating Margin of 11.45%. This is comparable to the rest of the industry: TAC outperforms 50.00% of its industry peers.
In the last couple of years the Operating Margin of TAC has grown nicely.
TAC has a better Gross Margin (83.61%) than 95.00% of its industry peers.
In the last couple of years the Gross Margin of TAC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.45% | ||
| PM (TTM) | N/A | ||
| GM | 83.61% |
OM growth 3Y15.27%
OM growth 5Y8.46%
PM growth 3YN/A
PM growth 5Y22.94%
GM growth 3Y3.39%
GM growth 5Y-0.46%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TAC is still creating some value.
The number of shares outstanding for TAC has been reduced compared to 1 year ago.
Compared to 5 years ago, TAC has more shares outstanding
TAC has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.53, we must say that TAC is in the distress zone and has some risk of bankruptcy.
TAC has a Altman-Z score of 0.53. This is comparable to the rest of the industry: TAC outperforms 60.00% of its industry peers.
The Debt to FCF ratio of TAC is 14.89, which is on the high side as it means it would take TAC, 14.89 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of TAC (14.89) is better than 85.00% of its industry peers.
A Debt/Equity ratio of 2.28 is on the high side and indicates that TAC has dependencies on debt financing.
TAC has a Debt to Equity ratio (2.28) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 14.89 | ||
| Altman-Z | 0.53 |
ROIC/WACC0.51
WACC6.59%
2.3 Liquidity
A Current Ratio of 0.79 indicates that TAC may have some problems paying its short term obligations.
TAC has a Current ratio (0.79) which is in line with its industry peers.
A Quick Ratio of 0.72 indicates that TAC may have some problems paying its short term obligations.
The Quick ratio of TAC (0.72) is worse than 65.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.72 |
3. Growth
3.1 Past
The earnings per share for TAC have decreased strongly by -102.94% in the last year.
TAC shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 26.80% yearly.
TAC shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -20.91%.
The Revenue has been growing slightly by 3.92% on average over the past years.
EPS 1Y (TTM)-102.94%
EPS 3YN/A
EPS 5Y26.8%
EPS Q2Q%0%
Revenue 1Y (TTM)-20.91%
Revenue growth 3Y1.5%
Revenue growth 5Y3.92%
Sales Q2Q%-26.19%
3.2 Future
The Earnings Per Share is expected to grow by 22.27% on average over the next years. This is a very strong growth
TAC is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -2.75% yearly.
EPS Next Y-72.18%
EPS Next 2Y-25.75%
EPS Next 3Y-13.76%
EPS Next 5Y22.27%
Revenue Next Year-6.21%
Revenue Next 2Y-12.92%
Revenue Next 3Y-6.56%
Revenue Next 5Y-2.75%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for TAC. In the last year negative earnings were reported.
TAC is valuated quite expensively with a Price/Forward Earnings ratio of 80.10.
Compared to the rest of the industry, the Price/Forward Earnings ratio of TAC is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 22.50. TAC is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 80.1 |
4.2 Price Multiples
TAC's Enterprise Value to EBITDA ratio is in line with the industry average.
TAC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. TAC is cheaper than 90.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.2 | ||
| EV/EBITDA | 13.27 |
4.3 Compensation for Growth
A cheap valuation may be justified as TAC's earnings are expected to decrease with -13.76% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-25.75%
EPS Next 3Y-13.76%
5. Dividend
5.1 Amount
TAC has a Yearly Dividend Yield of 3.91%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 4.71, TAC pays a bit more dividend than its industry peers.
TAC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.91% |
5.2 History
On average, the dividend of TAC grows each year by 6.10%, which is quite nice.
TAC has been paying a dividend for at least 10 years, so it has a reliable track record.
TAC has decreased its dividend in the last 3 years.
Dividend Growth(5Y)6.1%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
The earnings of TAC are negative and hence is the payout ratio. TAC will probably not be able to sustain this dividend level.
TAC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP-74.25%
EPS Next 2Y-25.75%
EPS Next 3Y-13.76%
NYSE:TAC (10/31/2025, 3:58:58 PM)
17.655
+0.02 (+0.09%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryIndependent Power and Renewable Electricity Producers
Earnings (Last)
Earnings (Next)
Inst Owners71.21%
Inst Owner Change-0.01%
Ins Owners0.44%
Ins Owner ChangeN/A
Market Cap5.23B
Revenue(TTM)2.51B
Net Income(TTM)-167000000
Analysts78.95
Price Target13.54 (-23.31%)
Short Float %1.91%
Short Ratio3.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.91% |
Yearly Dividend0.29
Dividend Growth(5Y)6.1%
DP-74.25%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)17.25%
Min EPS beat(2)-21.18%
Max EPS beat(2)55.69%
EPS beat(4)1
Avg EPS beat(4)-176.87%
Min EPS beat(4)-564.33%
Max EPS beat(4)55.69%
EPS beat(8)4
Avg EPS beat(8)-7.79%
EPS beat(12)6
Avg EPS beat(12)9.91%
EPS beat(16)7
Avg EPS beat(16)-93.68%
Revenue beat(2)1
Avg Revenue beat(2)3.34%
Min Revenue beat(2)-14.2%
Max Revenue beat(2)20.88%
Revenue beat(4)3
Avg Revenue beat(4)12.25%
Min Revenue beat(4)-14.2%
Max Revenue beat(4)24.1%
Revenue beat(8)6
Avg Revenue beat(8)27.41%
Revenue beat(12)10
Avg Revenue beat(12)34.69%
Revenue beat(16)14
Avg Revenue beat(16)33.54%
PT rev (1m)-1.12%
PT rev (3m)5.26%
EPS NQ rev (1m)-5.31%
EPS NQ rev (3m)-28.83%
EPS NY rev (1m)-5.76%
EPS NY rev (3m)-64.26%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)-1.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 80.1 | ||
| P/S | 2.92 | ||
| P/FCF | 24.2 | ||
| P/OCF | 12.06 | ||
| P/B | 4.64 | ||
| P/tB | 9.19 | ||
| EV/EBITDA | 13.27 |
EPS(TTM)-0.04
EYN/A
EPS(NY)0.22
Fwd EY1.25%
FCF(TTM)0.73
FCFY4.13%
OCF(TTM)1.46
OCFY8.29%
SpS6.04
BVpS3.8
TBVpS1.92
PEG (NY)N/A
PEG (5Y)N/A
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.87% | ||
| ROE | -10.58% | ||
| ROCE | 4.04% | ||
| ROIC | 3.34% | ||
| ROICexc | 3.5% | ||
| ROICexgc | 3.96% | ||
| OM | 11.45% | ||
| PM (TTM) | N/A | ||
| GM | 83.61% | ||
| FCFM | 12.09% |
ROA(3y)3.11%
ROA(5y)-0.07%
ROE(3y)17.47%
ROE(5y)0.34%
ROIC(3y)8.64%
ROIC(5y)N/A
ROICexc(3y)9.79%
ROICexc(5y)N/A
ROICexgc(3y)11.08%
ROICexgc(5y)N/A
ROCE(3y)10.46%
ROCE(5y)N/A
ROICexgc growth 3Y15.81%
ROICexgc growth 5Y18.53%
ROICexc growth 3Y15.46%
ROICexc growth 5Y17.81%
OM growth 3Y15.27%
OM growth 5Y8.46%
PM growth 3YN/A
PM growth 5Y22.94%
GM growth 3Y3.39%
GM growth 5Y-0.46%
F-Score4
Asset Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.28 | ||
| Debt/FCF | 14.89 | ||
| Debt/EBITDA | 4.18 | ||
| Cap/Depr | 53.32% | ||
| Cap/Sales | 12.17% | ||
| Interest Coverage | 1.05 | ||
| Cash Conversion | 70.78% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.72 | ||
| Altman-Z | 0.53 |
F-Score4
WACC6.59%
ROIC/WACC0.51
Cap/Depr(3y)120.63%
Cap/Depr(5y)98.51%
Cap/Sales(3y)23.21%
Cap/Sales(5y)22.28%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-102.94%
EPS 3YN/A
EPS 5Y26.8%
EPS Q2Q%0%
EPS Next Y-72.18%
EPS Next 2Y-25.75%
EPS Next 3Y-13.76%
EPS Next 5Y22.27%
Revenue 1Y (TTM)-20.91%
Revenue growth 3Y1.5%
Revenue growth 5Y3.92%
Sales Q2Q%-26.19%
Revenue Next Year-6.21%
Revenue Next 2Y-12.92%
Revenue Next 3Y-6.56%
Revenue Next 5Y-2.75%
EBIT growth 1Y-71.1%
EBIT growth 3Y17%
EBIT growth 5Y12.72%
EBIT Next Year63.68%
EBIT Next 3Y15.38%
EBIT Next 5Y19.44%
FCF growth 1Y269.27%
FCF growth 3Y-2.47%
FCF growth 5Y2.59%
OCF growth 1Y-40.86%
OCF growth 3Y-7.35%
OCF growth 5Y-1.28%
TRANSALTA CORP / TAC FAQ
What is the ChartMill fundamental rating of TRANSALTA CORP (TAC) stock?
ChartMill assigns a fundamental rating of 4 / 10 to TAC.
What is the valuation status for TAC stock?
ChartMill assigns a valuation rating of 2 / 10 to TRANSALTA CORP (TAC). This can be considered as Overvalued.
What is the profitability of TAC stock?
TRANSALTA CORP (TAC) has a profitability rating of 5 / 10.
Can you provide the expected EPS growth for TAC stock?
The Earnings per Share (EPS) of TRANSALTA CORP (TAC) is expected to decline by -72.18% in the next year.
Is the dividend of TRANSALTA CORP sustainable?
The dividend rating of TRANSALTA CORP (TAC) is 5 / 10 and the dividend payout ratio is -74.25%.