TransAlta Co. (NYSE:TAC) Increases Dividend to $0.05 Per Share

TransAlta Co. (NYSE:TAC) (TSE:TA) announced a quarterly dividend on Friday, February 21st, Wall Street Journal reports. Stockholders of record on Sunday, June 1st will be given a dividend of 0.0458 per share by the utilities provider on Tuesday, July 1st. This represents a $0.18 dividend on an annualized basis and a dividend yield of 1.68%. The ex-dividend date is Friday, May 30th. This is a boost from TransAlta’s previous quarterly dividend of $0.04.

TransAlta has raised its dividend payment by an average of 8.8% annually over the last three years. TransAlta has a payout ratio of 106.3% meaning the company cannot currently cover its dividend with earnings alone and is relying on its balance sheet to cover its dividend payments. Equities research analysts expect TransAlta to earn $0.41 per share next year, which means the company should continue to be able to cover its $0.17 annual dividend with an expected future payout ratio of 41.5%.

TransAlta Stock Performance

Shares of TAC traded down $0.41 during midday trading on Friday, reaching $10.88. 1,353,669 shares of the stock were exchanged, compared to its average volume of 2,049,731. The business’s 50-day moving average price is $12.70 and its 200 day moving average price is $10.94. The company has a debt-to-equity ratio of 2.94, a current ratio of 0.74 and a quick ratio of 0.67. TransAlta has a twelve month low of $5.94 and a twelve month high of $14.64. The company has a market capitalization of $3.24 billion, a price-to-earnings ratio of 29.39 and a beta of 0.83.

TransAlta (NYSE:TAC) (TSE:TA) last released its quarterly earnings results on Thursday, February 20th. The utilities provider reported ($0.16) earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.12 by ($0.28). TransAlta had a return on equity of 17.46% and a net margin of 5.72%. The company had revenue of $484.60 million for the quarter. On average, sell-side analysts expect that TransAlta will post 0.5 EPS for the current fiscal year.

Wall Street Analyst Weigh In

A number of equities research analysts have weighed in on TAC shares. Desjardins reaffirmed a “hold” rating on shares of TransAlta in a report on Wednesday, November 6th. Cibc World Mkts raised TransAlta from a “hold” rating to a “strong-buy” rating in a report on Tuesday. StockNews.com raised TransAlta from a “hold” rating to a “buy” rating in a report on Tuesday, February 11th. Scotiabank lowered TransAlta from a “sector outperform” rating to a “sector perform” rating in a report on Thursday, January 23rd. Finally, CIBC raised TransAlta from a “neutral” rating to an “outperformer” rating and lowered their price objective for the company from $23.00 to $19.50 in a report on Tuesday. Two investment analysts have rated the stock with a hold rating, one has issued a buy rating and one has assigned a strong buy rating to the company. According to MarketBeat.com, the stock presently has a consensus rating of “Moderate Buy” and a consensus target price of $19.50.

TransAlta Company Profile

TransAlta Corporation engages in the development, production, and sale of electric energy. It operates through Hydro, Wind and Solar, Gas, Energy Transition, and Energy Marketing segments. The Hydro segment holds interest of approximately 922 megawatts (MW) of owned hydroelectric generating capacity located in Alberta, British Columbia, and Ontario.