Topic: How To Invest

Dividend Advisor Hotline – Friday, January 13, 2023

Article Excerpt

ALGONQUIN POWER & UTILITIES CORP., $8.93, Toronto symbol AQN, is still a buy for long-term gains. The company has two main businesses: the Regulated Services Group provides regulated electricity, gas, water distribution and wastewater collection services in Canada, the U.S., Chile, and Bermuda; and the Renewable Power Group produces electricity from about 40 clean-energy plants in North America. Algonquin needs to conserve cash for its upcoming acquisition of Kentucky Power Co., which generates and distributes electricity to 228,000 customers in Kentucky. The company will pay $2.65 billion U.S., including Kentucky Power’s debt. That price is equal to 58% of Algonquin’s $6.1 billion (Canadian) market cap. Regulators recently rejected the proposal, but Algonquin still hopes to secure approval later this year. As a result, Algonquin is cutting your quarterly dividend by 40.0%. Starting with the April 2023 payment, investors will receive $0.1085 U.S. a share instead of $0.1808 U.S. The new annual rate of $0.434 U.S. still yields a high 6.5%. The company will also…