Pattern Energy Group Inc. (PEGI)

[sunnypease 35]

Nice to see the turbines like this...

https://www.greentechmedia.com/multimedia/view/drones-film-western-canadas-largest-wind-farm-with-60-wind-turbines

[dydo 1,560]

Pattern's is selling stock

[dydo 1,560]

PEGI sells at 23.40, more acqusitions possible again.

[sunnypease 35]

5 hours ago, dydo said:

PEGI sells at 23.40, more acqusitions possible again.

Think this is a good place to buy some PEGI?  It's accretive so the share price should move higher than the offering price, one would hope.

[dydo 1,560]

According to the prospectus, PSP was going to buy up to $15M in shares out of the offering. Interestingly Merill Lynch who was one of the underwriters, day after closing sends the underperforming rating and set the price at $21. Looks to me like the dealer now wants to buy those shares at the lower price. Cheats.

[solarpete 102]

15 hours ago, dydo said:

Cheats.

Agreed.  Never trust a Wall Street banker/broker/underwriter.  Heck, half the time they don't even put their own clients' best interests before those of their firm (remember Goldman Sacks hyping bad mortgages to their clients while shorting them in their own trading--and I'm sure they weren't the only ones).

[sunnypease 35]

https://www.awea.org/SenateTaxReformPTC

Senate tax reform keeps the PTC as is.

Also PEGI in their CC Q3 2017, though it may no longer be relevant:

Let me start with - we support many parts of tax reform, but we don't think the House provisions modifying the PTCs available to wind will survive. We are very good encouraged by the recent announcements of several key Republican senators saying that these provisions are dead on arrival in the Senate. As background, it's important to remember that the proposed House tax bill improves the returns on our existing assets over time primarily as a result of the lower corporate tax rate.

Additionally, our near-term growth is primarily outside the U.S. as evidenced by over 60% of our iROFO assets are outside the U.S. The bill has currently proposed primarily affects new projects being developed by Pattern Development. Pattern Development's pipeline has a number of projects that could be delayed, killed or need to be modified if the House bill were to be passed in its current form.

But beyond those few projects Pattern Development would adjust the pricing of its power sales reflecting any new tax law. This may make certain wind projects less competitive and could slow Pattern Development's growth in the U.S. for a limited period. But over the time, the market will adjust and continue to grow. Clearly, the bill does not affect our growth activities outside the U.S. So let's see what happens in the coming weeks. I think it is clear. It will become clear and we will be favorable and it will be favorable, but it will require some patience.

Edited November 10, 2017 by sunnypease

[dydo 1,560]

GS upgrades Pattern to $25

[sunnypease 35]

Some negative comments recently regarding PEGI. 

Has anyone read or heard more about tax issues confronting PEGI?

Edited December 13, 2017 by sunnypease

[dydo 1,560]

17 minutes ago, sunnypease said:

Some negative comments recently regarding PEGI. 

Has anyone read or heard more about tax issues confronting PEGI?

you mean this

Pattern Energy downgraded to Equal Weight at Morgan Stanley As previously reported, Morgan Stanley analyst Stephen Byrd downgraded Pattern Energy to Equal Weight from Overweight, citing his belief that the company will face a more challenging financing outlook in coming years and will need to reduce its "lofty dividend payout ratio." He lowered his price target on Pattern Energy to $25 from $33.

Read more at:
https://thefly.com/landingPageNews.php?id=2653914

[dydo 1,560]

GS had this on the 5th

Pattern Energy Group Inc (NASDAQ: PEGI), a power company that focuses on wind, solar and transmission projects in the U.S., has underperformed recently, offering investors an entry point, according to Goldman Sachs.

The Analyst

Goldman Sachs analyst Brian Lee upgraded shares from Neutral to Buy, with a 12-month price target of $25, suggesting a 22 percent return potential compared to the 11 percent average return of the firm's coverage universe.

The Thesis

A combination of lower wind production, equity issuance and U.S. tax reform concerns have pressured the shares of Pattern Energy in recent months, Lee said in a note. Given the view these headwinds are transitory in nature, the analyst sees a setup for easier comps and mean revision potential, with respect to weather-impacted production levels.

This, according to Lee, argues for a favorable risk/reward.

Pattern Energy is now one of the highest-yielding YieldCos at about 8 percent on 2018 estimates compared to 6.5 percent for peers, Goldman said. The firm believes execution on dropdowns and organic cost improvements would support 20 percent cash available for distribution, or CAFD, in 2018-19, and an improvement in payout ratio back down to 85-90 percent.

Goldman sees the returning of fourth quarter wind production to average, dropdowns and lower payout ratio, organic cost savings and liquidity as upcoming catalysts.

[sunnypease 35]

Good to hear Goldman thinks the tax issue is a temporary headwind.

Headline news at the NYT is that they have put together a combo House/Senate bill now.  Any word on what has happened to the PTC / ITC / AMT / and BEAT?

 

[MVA 25]

1 hour ago, sunnypease said:

Good to hear Goldman thinks the tax issue is a temporary headwind.

Headline news at the NYT is that they have put together a combo House/Senate bill now.  Any word on what has happened to the PTC / ITC / AMT / and BEAT?

 

https://www.vox.com/energy-and-environment/2017/12/13/16768074/tax-bill-renewable-energy-wind-solar-credits

[dydo 1,560]

Looks like PTC credit is intact now to get BEAT out. PEGI reacted well because of It?

https://www.bloomberg.com/news/articles/2017-12-13/compromise-tax-bill-is-said-to-keep-wind-electric-car-credits-jb5dh81s
 

[dydo 1,560]

AMT is removed, so the only thing left or unknown on is BEAT.

the wind had come up nicely, including NEP. 

https://pv-magazine-usa.com/2017/12/13/future-of-solar-and-wind-finance-unclear-in-final-tax-reform-bill/

[sunnypease 35]

written just yesterday from union of concerned scientists

https://blog.ucsusa.org/steve-clemmer/tax-bill-job-losses

[sunnypease 35]

PEGI dropping rather hard.  

Some new tax law info?

[sunnypease 35]

https://www.utilitydive.com/news/energy-tax-credits-appear-safe-as-gop-tax-bill-speeds-toward-a-vote/513127/

I see... the status is STILL in flux.  idiot politicians.  

The only useful part of the government & it is left begging for nickels.

[sunnypease 35]

This is strange folks. Why is PEGI selling off & the solars & CAFD & RUN are not selling off?

Some wind specific bad news?

 

 

[dydo 1,560]

You need to look at NEP and other yieldcos they are the same and NEP is up. I think some momentum selling got better of the stock. 

[dydo 1,560]

Sold my PEGI buy from this morning. Got some cash made. Only noticed CSIQ dropped. Yeah despair is setting in. 

[sunnypease 35]

Why the PEGI sell?   Fear of what comes next with the tax bill?

[dydo 1,560]

2 minutes ago, sunnypease said:

Why the PEGI sell?   Fear of what comes next with the tax bill?

What sell, mine or the markets? The stock came up 5% on two days and it become a trading stock. It came back and as I have said NEP, TERP and CAFD are all green. If it was bill it would affect all, No?

[sunnypease 35]

2 hours ago, dydo said:

What sell, mine or the markets? The stock came up 5% on two days and it become a trading stock. It came back and as I have said NEP, TERP and CAFD are all green. If it was bill it would affect all, No?

I guess so.   I thought maybe it could also have to do with the recent Fed rate increase - though this was widely expected.  I'm not sure.  I'll hold onto my PEGI, cross my fingers & hope for the best.

[dydo 1,560]

Sounds like BEAT was amended and keeping 80% of tax equity buyers in or at least how I read it.

https://www.greentechmedia.com/articles/read/final-tax-bill-amends-beat-provision-to-keep-ptc-and-itc-value#gs.ZNBCe48

Moving on, but without CSIQ, shame.

[dydo 1,560]

DId you know., They better not pay the price of the stock.

Capital Dynamics and Pattern Energy (PEGI) are both interested in acquiring 8Point3 Energy (CAFD), according to Bloomberg, citing sources familiar with the matter. The sources added that a deal may be announced "within weeks."

Read more at:
https://thefly.com/landingPageNews.php?id=2644682

[dydo 1,560]

This was published today around 10 hours ago

Quinbrook Infrastructure Partners, a renewable energy infrastructure investor, is among the bidders looking to acquire 8point3 Energy Partners (CAFD), according to SparkSpread. Others vying for 8point3 are thought to include Capital Dynamics, Southern Co. (SO) and AES Corp. (AES), the report added, according to contacts.Reference Link

Read more at:
https://thefly.com/landingPageNews.php?id=2656089

[dydo 1,560]

Yieldcos are in again

https://marketintelligence.spglobal.com/our-thinking/news/as-new-year-approaches-bullishness-returns-to-yieldco-market

[pg6solar 113]

Thank you, Odyd.

[dydo 1,560]

I have spent long hours looking at the future of my investing. Since I am older than I was when the site started some 7 years ago, I am looking for some income now in my investing. I looked at REITs and looked at MLPs. I do not like either of them despite high income as the first ones are much impacted by the interest rates, mortgages etc.  properties and so on. Then I MLPs have no benefits in my retirement accounts.

I am looking at yieldcos as a potent avenue for my investing, and it is not a blind jump into a sector. I have done research on it and have recommended stocks.  NEP is my favorite followed by PEGI. Happens that PEGI is the biggest holding simply by access to the price. I will offer my time to look at them and analyze if there is anything to analyze. I see this to be, at least for me, a renewable story continuation.