Making sense of the markets this week: Might 14, 2023

Canadian pipeline income proceed to move 

Enbridge, TC Vitality and Keyera additionally reported earnings this week, they usually had been largely according to what analysts had predicted; because of this, all three pipeline shares had been up between 1% and a pair of% over the past 5 buying and selling days.

Trying forward, subsequent quarter’s income is probably not fairly so uplifting, as Alberta’s wildfires proceed to have widespread human and financial penalties. Practically 30,000 residents have been evacuated, and 109 fires have already affected power manufacturing. This can clearly have an effect on firms’ backside traces.

You’ll be able to learn extra of my ideas on Canadian pipeline shares at

Algonquin Energy leaves Kentucky, comes again to actuality

Maybe no single inventory on the Toronto Inventory Change has generated extra shock over the past yr than Algonquin Energy (AQN/TSX). Heading into 2022, the corporate was seen as a comparatively steady mixture of utility supplier and renewable power generator. Then, final November, rate of interest realities lastly hit, and all that debt-fuelled progress didn’t look fairly so shiny.

This week, Algonquin introduced strong earnings-per-share numbers of $0.17 (versus $0.16 predicted) and quarterly revenues of $778.6 million (versus $733.7 million predicted). Regardless of the slight outperformance relative to expectations, shares had been down 2.68% on Thursday.

Algonquin’s share worth historical past is a good instance of how numbers may be manipulated to inform utterly completely different tales. For instance, I may inform you that the corporate was severely oversold and has had unbelievable momentum this yr…

Graph of Algonquin Power stock performance year-to-date up to May 11
Supply: Google Finance

Or I may inform you that Algonquin shareholders are nonetheless affected by having the wool pulled over their eyes, and administration has a protracted strategy to go to get again to their earlier reliable standing.

Graph of Alqonquin Power stock performance from May 2022 to May 2023
Supply: Google Finance

An important latest information for Algonquin is the breakup of the Kentucky Energy acquisition. Algonquin’s president and CEO, Arun Banskota, addressed this transaction at first of the earnings name, saying, “Final month, we introduced with AEP a mutual termination of settlement to accumulate Kentucky Energy Firm and AEP Kentucky Transmission Firm. This was not a simple choice. Nevertheless, our board of administrators and administration group determined that, given the difficult and constantly evolving macroeconomic surroundings and regulatory uncertainty over a remaining order, it was in the perfect curiosity of the corporate to terminate the transaction.”

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