Innergex Renewable Energy (TSE: INE) is an independent Canadian renewable power producer. It develops, acquires, owns, and operates hydroelectric, wind, and solar facilities in Canada, the United States, France, and Chile. Most of the energy that the company generates comes from its hydroelectric facilities.
Innergex Renewable Energy primarily generates revenue through the sale of electricity from its hydroelectric sites. The company’s wind farms also generate substantial amounts of energy and revenue.
The company announced that it completed the acquisition of Aela Generacion S.A. and Aela Energia SpA. The acquisition has allowed the company to become one of the top renewable energy producers in Chile.
For a price tag of C$861.2 million, Innergex receives three operating wind farms with an installed capacity of 332 MW, allowing the company to double its current installed capacity in the country.
Furthermore, the main source of revenue generated by these assets comes from two long-term contracts with 25 companies that mature in 2036 and 2041. In the next 12 months, the new facilities are expected to bring in revenue of C$93.5 million, with operating expenses of C$33.4 million.
Insider Transactions
Taking a look at Innergex’s insider transactions, you can see that the TipRanks Insider Confidence Signal is currently positive, much better than the sector average:
The most noteworthy purchase comes from 10%+ shareholder Hydro-Quebec, which purchased $37,275,000 worth of shares four months ago. Indeed, Hydro-Quebec invested the money into Innergex as part of a private placement to help fund this acquisition. This demonstrates that Hydro-Quebec has a high level of confidence in this acquisition.
Analyst Recommendations
Innergex has a Strong Buy consensus rating based on five Buys and one Hold assigned in the past three months. The average Innergex Renewable Energy price target of C$22.17 implies 23.5% upside potential.
Final Thoughts
The acquisition appears to be an attractive opportunity for the company to expand its operations in Chile. In addition, both insiders and analysts have a favorable view of the company. Nevertheless, investors may want to take a deeper look at the stock before deciding whether to Buy or Sell.
