AQN Should I Buy
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Algonquin Power & Utilities Corp (AQN) is not a strong buy for a beginner, long-term investor at this time. While there are some positive catalysts, the negative financial performance, reduced earnings guidance, and lack of strong trading signals suggest holding off on investment until clearer signs of recovery emerge.
The MACD is negatively expanding, indicating bearish momentum. RSI is neutral at 30.996, and moving averages are converging, showing no clear trend. The stock is trading near its support level (S1: 6.188), which may limit downside risk but does not indicate a strong buy signal.
Hedge funds are significantly increasing their positions, with a 241.67% increase in buying over the last quarter. Analysts like Raymond James and National Bank have upgraded the stock recently, citing operational improvements and cost discipline.
The company has reduced its 2027 earnings guidance due to higher tax burdens, eroding investor confidence. Financial performance in Q4 2025 showed a sharp decline in net income (-109.73% YoY) and EPS (-107.69% YoY). Analysts from CIBC and TD Securities have lowered their price targets, reflecting concerns about the company's near-term outlook.
In Q4 2025, revenue increased by 7.84% YoY to $630.7 million, but net income dropped significantly to $18.4 million (-109.73% YoY). EPS also fell to 0.02 (-107.69% YoY), and gross margin slightly declined to 54.46%.
Recent analyst ratings are mixed. While Raymond James and National Bank upgraded the stock with higher price targets ($7.25 and $7.50, respectively), CIBC and TD Securities lowered their price targets to $6.25 and $6, citing concerns over reduced earnings guidance and tax headwinds.
