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TransAlta: The Best Way To Play The Renewables Segment

Jan. 03, 2022 7:02 AM ETTransAlta Renewables Inc. (TRSWF), RNW:CA13 Comments
Brant Munro, CFA profile picture
Brant Munro, CFA


  • As a result of projects coming online in 2022, I expect at least modest AFFO growth for 2022.
  • RNW is among the cheapest in the renewables segment and most conservatively leveraged.
  • As a result of the low leverage and affiliation with TAC, I should expect Moody's, S&P, and Fitch to take notice and their cost of capital to improve over time.
TransAlta Cascade hydro power plant. Banff National Park, Canadian Rockies

CHENG FENG CHIANG/iStock Editorial via Getty Images

*** Please note all figures are in CAD unless otherwise noted.

I have decided to begin coverage on TransAlta Renewables (OTCPK:TRSWF) which trades under RNW on the TSX. I believe it presents a solid income/value play in the renewables segment

This article was written by

Brant Munro, CFA profile picture
I am always on the lookout for businesses that have a strong cash generating ability and a strong enough competitive advantage that I can be sure they will be around for the next decade, and at a price where I can be as sure as possible that I can achieve at least 15 percent annualized returns, or else companies whose price is deeply discounted from their asset base as long as its highly marketable. Im not one to shy away from takeover targets, provided the target still has a strong business that I would be okay with owning it even if the takeover did not go through. Since I began investing on my own 3 years ago I have achieved an annualized time weighted return of about 16 percent, and plan to continue to beat that hurdle as I learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of TRSWF either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Long via cash secured puts.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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