Is Atlantic Power poised for a Recovery?

        Atlantic Power is an utility that has been covered in several of my Workathon blogs.The financial literature (both online and offline) is full of blogs that say that ATP is ready for a comeback.It was $13/share in 2013 and has traded as low as $1.45/share.but their new CEO has done a lot of things to improve Atlantic Power and so some pundits are suggesting there may be a comeback.This blogs' answer is no-not yet.                

              Changes since 2013
    It was starting to look like ATP would rebound in 2019.The stock had moved up to the $3.50 level.Debt had been cut almost in half although the dividend was gone now.It had a power generating capacity of 2138 MW of which it owns 1500 MW.But back in 2013 it owned 28 power plants and now it owns 23 (2 are in Canada).ATP just released it's Q1 results and almost all financial indicators were down from Q1 2018.It appears that Atlantic Power is suffering from the closing of four plants in northern Ontario. Although there has been some compensation from the province as a result of their Go Green platform.So the price has fallen off from their January and February highs.Recently Atlantic Power has made arrangements to sell it's 300 MW Manchief natural gas power plant.But in return it bought from Altagas their share of two biomass plants which generate about 85MW of power.
        Slow Growth
     Atlantic Power had 28 generating plants in 2013.Now it has 23 and selling one more in 2022 ( 300MW).It is not totally replacing the generating power that has been lost.But it is buying 50% interests in 2 biomass plants with 85 MW of power this year.On the positive side it has reduced total debt by about 50%.There is credit capacity to buy or to build more generating capacity.However there is another option!ATP  would make an excellent fit for one or two Canadian utilities with significant foreign (especially American utilities).One is Emera and another is Algonquin Power.This blog has suggested an acquisition with Algonquin but it is possible that Algonquin sees too many problems.Also they just made an investment in Bermuda.There would be connection or combination problems as well as internal ATP problems.But Emera could also be a good fit and has a very substantial cash flow (about$700 million).       http://algonquinpower.com/ http://www.emera.com/en/home/default.aspx