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Atlantic Power: A 10% Dividend Yield And Potential Sale Could Yield An Additional 70% Capital Gain

Note: We submitted an analysis of Atlantic Power (NYSE:AT) for the Sohn Conference Investment Idea Contest. Our submission was named a semifinalist. The contest sought the best investment idea for the next 12 months and the judges included Bill Ackman, Seth Klarman and David Einhorn.

Overview

Atlantic Power shares have lost over 70% of their value in the past six months primarily driven by a poorly communicated reduction in monthly dividends. The fall in share price has highlighted the need for the company to sell itself to a larger more efficient operator. Atlantic Power owns a desirable collection of non-coal power plants with Power Purchase Agreements that are best owned by a firm that has a...

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