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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Just Energy Group, Inc. (TSX: JE ) (NYSE: JE ) are nearly 10% higher on both American and Canadian exchanges today after the company reported strong earnings for its fiscal third quarter.
So what: Just Energy came through with $859 million in sales for the third quarter, producing profit from continuing operations of $177.5 million, or $0.96 per share. The top line grew 17% over the year-ago quarter, but EPS soared 243% over the year-ago quarter's result of just $0.28. The company added a net 50,000 customers after recording 345,000 total additions and installs for the quarter. Its customer base of 4.6 million is 7% higher year over year. Also promising was news that the company's dividend payout ratio on base funds from continuing operations fell to a sustainable 80% for the quarter as compared to the year-ago quarter's 126% payout ratio.
Now what: Just Energy presently boasts a dividend yield of more than 10% on both exchanges, and the improvement in its payout ratio is a good sign patient income investors. However, Just Energy's stock is now in the high end of a trading range that has been relatively stable for a year after suffering a halving of share prices since early 2012. It's not a cheap stock, but if this performance is indicative of Just Energy's potential, it could eventually head back to those highs. For the moment, it's a reasonably attractive income play.
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