Honestly, this dividend stock used to have a higher dividend yield. And back then, it was unclear whether investors wanted in or not. But since then, times have changed. The company has seen its share price rise higher and higher. And while that’s meant a lower dividend yield, it has also meant far more returns.
So today, we’re going to look at dividend stock Northland Power (TSX:NPI), a renewable energy producer set up for years of passive income – with dividends coming in every single month.
About NPI stock
Northland Power is a Canadian renewable energy company that develops, builds, owns, and operates clean and green power infrastructure projects globally. The company’s primary focus is on developing offshore wind, onshore renewable, and natural gas projects. Northland Power’s portfolio includes a diverse range of projects, including wind farms, solar facilities, and thermal power plants.
One of Northland Power’s notable projects is the Gemini Wind Farm, located off the coast of the Netherlands in the North Sea. Gemini is one of the world’s largest offshore wind farms and has a capacity of approximately 600 megawatts, providing clean energy to over 1.5 million people. However, it also has operations in Europe and Asia as well. Overall, it’s a strong contender for growth in the renewable energy transition.
Seeing growth
In the last year shares of the dividend stock have climbed higher, and this comes on the back of earnings for the company. NPI stock has been enjoying some strong momentum, so let’s take a look at the last few quarters to see what’s been going on.
During the second quarter, gross profit was at $427 million, with sales at $472 million. Net income was at $22 million, which was disappointing compared to the $268 million achieved in 2022. However, momentum was underway by the third quarter.
In this quarter, sales increased to $513 million, with net income almost double at $43 million, as well as gross profit of $458 million. By the fourth quarter, sales surged to $626 million, with gross profit of $566 million. The company operated at a net loss however for the fourth quarter at $268 million.
More growth to come
The big news that sent shares upwards however on top of momentum was the outlook for 2024. Management believes there will be more energy contributions and better interest rates. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) should reach between $1.2 and $1.3 billion in 2024. Further, adjusted free cash flow should be between $1.30 and $1.50 per share. This would be lower than 2023 levels, but with savings from cost expenditures as well.
Overall, the dividend stock is improving. This has added returns for shareholders, though shares are still down 36% in the last year. But with first quarter earnings around the corner, there could be some good guidance coming up.
All together, this dividend stock could bring in substantial dividend income in 2024. And what’s more, returns on top of that. So it definitely deserves the attention of investors on the TSX today.
