Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Atlantic Power Corporation Popped 38% in March

By Travis Hoium - Apr 7, 2016 at 12:45PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Better-than-expected earnings had Atlantic Power Corporation's shares moving higher last month.

Image source: Atlantic Power Corporation.

What: Shares of Atlantic Power Corporation (AT) jumped 38% in March after reporting fourth-quarter results that topped expectations.

So what: Total revenue in the fourth quarter fell 18% to $98.4 million and net loss ballooned from $10.6 million a year ago to $88.6 million, or $0.61 per share. Adjusting for asset impairments and discontinued operations, earnings were $0.08 per share, beating the $0.11 loss analysts were expecting.  

In 2016, management said it expects $200 million to $220 million in EBITDA and adjusted free cash flow of $20 million to $40 million.

Now what: Atlantic Power Corporation has done a nice job of reducing debt by $833 million over the past two years, leaving a more manageable $733.3 million debt load at the end of 2015. It's also encouraging that rating agencies recently upgraded the company's debt, which should make it more competitive in energy markets going forward.

There are a lot of unknowns in the energy market right now, but Atlantic Power seems to be doing a good job of reducing costs and debt at a time when that's prudent. If it can execute on plans to generate cash in 2016, the stock could have further to run higher.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Atlantic Power Corporation Stock Quote
Atlantic Power Corporation

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/30/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.