Avista Corp (NYSE: AVA)

Sector: Utilities Industry: Utilities - Diversified CIK: 0000104918
Market Cap 2.94 Bn
P/B 1.42
P/E 19.71
P/S 2.18
ROIC (Qtr) 5.62
Div Yield % 4.98
Rev 1y % (Qtr) 2.28
Total Debt (Qtr) 3.09 Bn
Debt/Equity (Qtr) 1.17
Add ratio to table...

About

Avista Corp., known by its ticker symbol AVA, is a prominent player in the energy industry, specializing in electric and natural gas services. Established in 1889 and headquartered in Spokane, Washington, Avista Corp. serves approximately 416,000 electric customers and 381,000 natural gas customers across its 30,000-square-mile service territory, home to a population of 1.7 million. Avista Corp.'s primary business activities revolve around the generation, transmission, and distribution of electricity and natural gas. These services are provided...

Read more

Investment thesis

Bull case

  • Operating cash flow of 483.79M provides strong 55.55x coverage of stock compensation 8.71M, indicating sustainable incentive practices.
  • Strong tangible asset base of 8.11B provides 2.62x coverage of total debt 3.09B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 483.79M provides solid 0.66x coverage of current liabilities 729M, showing strong operational health.
  • Tangible assets of 8.11B provide robust 25.03x coverage of other current liabilities 324M, indicating strong asset backing.
  • Retained earnings of 874M provide strong 16.81x coverage of intangibles 52M, indicating quality earnings retention.

Bear case

  • Operating cash flow of 483.79M barely covers its investment activities of (501.99M), with a coverage ratio of -0.96, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 44M against inventory of 228M, the 0.19 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Operating cash flow of 483.79M provides thin coverage of dividend payments of (156.53M) with a -3.09 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Free cash flow of (18.20M) provides weak coverage of capital expenditures of 502M, with a -0.04 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 358.37M show weak coverage of depreciation charges of 286.35M, with a 1.25 ratio indicating high capital intensity and potential reinvestment needs.

Segments Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Utilities - Diversified
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SRE Sempra 45.16 Bn 45.90 4.31 32.69 Bn
2 BIP Brookfield Infrastructure Partners L.P. 19.75 Bn 57.75 0.89 65.44 Bn
3 AES Aes Corp 10.89 Bn 16.56 0.83 31.90 Bn
4 AQN Algonquin Power & Utilities Corp. 8.39 Bn -225.33 3.51 6.43 Bn
5 AVA Avista Corp 2.94 Bn 19.71 2.18 3.09 Bn
6 UTL Unitil Corp 0.89 Bn 17.81 1.67 0.93 Bn
7 CIG Energy Co Of Minas Gerais 0.00 Bn 0.00 0.00 -

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.64 0.69
EV to Cash from Ops. EV/CFO 15.22 19.02
EV to Debt EV to Debt 1.68 1.58
EV to EBIT EV/EBIT 19.60 20.34
EV to EBITDA EV/EBITDA 10.79 11.94
EV to Free Cash Flow [EV/FCF] EV/FCF -79.59 -22.87
EV to Market Cap EV to Market Cap 1.77 2.15
EV to Revenue EV/Rev 3.86 3.99
Price to Book Value [P/B] P/B 1.42 2.48
Price to Earnings [P/E] P/E 19.71 -11.27
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.21 1.04
Dividend Payout Ratio % Div Payout % (Qtr) 82.40 -25.27
Dividend per Basic Share Div per Share (Qtr) 1.95 1.48
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) -868.30 -135.45
Interest Coverage Int. cover (Qtr) 2.33 2.23
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 7.16 17.33
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 382.24 81.54
Dividend Growth (1y) % Div 1y % (Qtr) 3.18 -0.35
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -7.39 98.90
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 9.56 14.34
EBIT Growth (1y) % EBIT 1y % (Qtr) 8.46 41.17
EBT Growth (1y) % EBT 1y % (Qtr) 13.06 73.58
EPS Growth (1y) % EPS 1y % (Qtr) -6.35 56.76
FCF Growth (1y) % FCF 1y % (Qtr) 57.69 62.76
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 11.46 13.93
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.24 0.20
Cash Payout Ratio Cash Payout (Qtr) 0.16 0.23
Cash Ratio Cash Ratio (Qtr) 0.06 0.10
Current Ratio Curr Ratio (Qtr) 0.91 0.98
Debt to Equity Ratio Debt/Equity (Qtr) 1.17 4.25
Interest Cover Ratio Int Coverage (Qtr) 2.33 2.23
Times Interest Earned Times Interest Earned (Qtr) 2.33 2.23
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 32.80 38.38
EBIT Margin % EBIT Margin % (Qtr) 18.25 22.44
EBT Margin % EBT Margin % (Qtr) 10.43 11.60
Gross Margin % Gross Margin % (Qtr) 57.10 37.77
Net Profit Margin % Net Margin % (Qtr) 9.60 7.30