Algonquin Power resumed with Neutral from Outperformer at CIBC (yesterday)

As reported yesterday afternoon, CIBC analyst Mark Jarvi downgraded Algonquin Power to Neutral from Outperformer with a price target of $10, down from $17, after resuming coverage of the name following a period of prolonged restriction. The decision to walk away from the Kentucky Power deal makes the most sense given the more challenged financial position of Algonquin today, the analyst tells investors in a research note. The firm says this is a "critical step " to Algonquin "turning a new page and addressing its funding and balance sheet challenges." However, the path forward to a full recovery "will not be easy," CIBC writes. It believes the company still needs to shore up its balance sheet through asset sales.