CPN  Calpine Corporation

Exchange

NYSE

Sector

Public Utilities

Industry

Electric Utilities: Central

Market Cap.

5.29B

Vuru Grade

37.85/100

Current Price

$14.66
-0.03 (-0.20%)

Growth Price

$18.51
Undervalued by 26.28%

Company Metrics

  • P/E 110.23
  • P/S 0.66
  • P/B 1.77
  • EPS 0.13
  • Cash ROIC 1.58%
  • Cash Ratio 0.11
  • Dividend 0 / 0%
  • Avg. Vol. 8.27M
  • Shares 360.85M
  • Market Cap. 5.29B

Company Description

Calpine Corporation, an independent wholesale power generation company, owns and operates natural gas-fired and geothermal power plants in North America. It operates natural gas-fired combustion turbines and renewable geothermal conventional steam turbines. The company sells wholesale power, steam, capacity, renewable energy credits, and ancillary services to utilities, independent electric system... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

SHAREHOLDER ALERT: Monteverde & Associates PC Announces An Investigation Of ...
PR Newswire (press release) - Aug 31, 2017
NEW YORK, Aug. 31, 2017 /PRNewswire/ -- Juan Monteverde, founder and managing partner at Monteverde & Associates PC, a boutique securities firm headquartered at the Empire State Building in New York City, is investigating Calpine Corporation ...
Lookout for Price Target? Calpine Corporation (CPN), United States Steel ...
StockNewsJournal - Sep 22, 2017
ROI deals with the invested cash in the company and the return the investor realize on that money based on the net profit of the business.
Calpine Corporation (CPN) Receives $14.96 Average Price Target from Brokerages - The Ledger Gazette
Calpine Corporation (CPN): Scrutinizing the Chart - Economic News
Calpine Corporation (CPN) Announces Update on Southwast Texas Operations from ...
StreetInsider.com - Aug 30, 2017
Calpine Corporation (NYSE: CPN) today reported that its fleet of flexible and modern natural gas-fired, combined-cycle power plants has performed well during the recent sustained weather event caused by Hurricane Harvey.
Analyst's Predictions on Calpine Corporation (CPN), Altria Group, Inc. (MO) - StockNewsJournal
Calpine Corporation (NYSE:CPN) Experiences Heavier than Usual Trading Volume - Modern Readers
Traders Secrets on Calpine Corporation (CPN), American Express Company (AXP)
StockNewsJournal - Sep 20, 2017
ROI deals with the invested cash in the company and the return the investor realize on that money based on the net profit of the business.
Risk Malaise Alert in Option Market: Calpine Corporation Implied Price Swing ...
CML News - Sep 23, 2017
Before we dive into any analysis we simply note that Calpine Corporation (NYSE:CPN) risk is actually priced pretty low by the option market as of right now.
Financial Comparison: Calpine Corporation (CPN) versus Public Service ...
The Ledger Gazette - Sep 23, 2017
Calpine Corporation (NYSE: CPN) and Public Service Enterprise Group (NYSE:PEG) are both mid-cap utilities companies, but which is the better investment?
Contrasting Public Service Enterprise Group (PEG) & Calpine Corporation (CPN) - Week Herald
Analyst's Predictions on Kinder Morgan, Inc. (KMI), Calpine Corporation (CPN)
StockNewsJournal - Sep 14, 2017
Calpine Corporation (NYSE:CPN), maintained return on investment for the last twelve months at -, higher than what Reuters data shows regarding industry's average.
Earnings Clues on Calpine Corporation (CPN), National Oilwell Varco, Inc. (NOV ...
StockNewsJournal - Sep 19, 2017
ROI deals with the invested cash in the company and the return the investor realize on that money based on the net profit of the business.
Are Calpine Corporation (CPN)'s Recent Ownership and Insider Trends a Sign of ...
NY Stock News - Sep 21, 2017
Recent trading patterns in the stock of Calpine Corporation (NYSE:CPN) have investors on high alert. Performance is ultimately what matters to investors, and it's worth taking a look at the data to get a sense of where CPN might be headed in the future.
Analytical Guide for two rising stock's: Calpine Corporation (CPN), Comcast ...
StockNewsJournal - Sep 6, 2017
Calpine Corporation (NYSE:CPN) market capitalization at present is $5.25B at the rate of $14.62 a share. The firm's price-to-sales ratio was noted 0.00 in contrast with an overall industry average of 89.83.
Recent Insider Trade: FUSCO JACK A sold 336425 Shares Of Calpine Corporation (CPN) - Economic News
Aviva PLC Has $3.08 Million Holdings in Calpine Corporation (NYSE:CPN) - The Ledger Gazette
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for CPN to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate CPN's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$14.66 Current Price

$18.51 Growth Price (DCF)

Undervalued by 26.28%


Growth Rate Assumed by Market: -14.53%


Future Free Cash Flow Growth Rate: -0.5%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$21.30 Book Price

Undervalued by 45.31%


Poor Cash Return on Invested Capital over the past 5 years

CPN has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

CPN has only created $1.58 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow 4.00M -26.00M 362.00M 298.00M 541.00M
divided by
Invested Capital 13.95B 14.09B 14.46B 14.88B 15.20B
Cash ROIC 0.03% -0.18% 2.50% 2.00% 3.56%

Poor Return on Equity over the past 5 years

CPN has shown an inability to deliver strong results for shareholders. This could be due to poor management, CPN operating in a highly competitive industry, or having a weak business in general.

CPN has only generated $9.07 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 199.00M 18.00M 961.00M 249.00M 111.00M
divided by
Stockholders' Equity 3.99B 3.51B 3.38B 3.11B 3.27B
Return on Equity 4.98% 0.51% 28.45% 8.01% 3.40%

Good Business Performance over the past 10 years

It's likely CPN has been unable to maintain profitability in tough economic times, making it a somewhat cyclical business. The other possibility is CPN has expended significant capital on items such as property, plant and equipment in specific years. Look for correlations.

CPN has created positive free cash flow for 7 or 8 of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow -14.00M 351.00M 582.00M 560.00M 61.00M 4.00M -26.00M 362.00M 298.00M 541.00M

Weak Balance Sheet

CPN's financial position is not ideal. The key is to check whether CPN is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 1.92B 1.66B 2.11B 2.05B 1.25B 1.28B 941.00M 717.00M 906.00M 418.00M
Current Assets 4.53B 7.50B 4.10B 3.43B 3.56B 2.83B 2.86B 4.22B 4.10B 4.43B
Total Assets 18.48B 20.74B 16.65B 17.26B 17.37B 16.55B 16.56B 18.38B 18.83B 19.32B
Current Liabilities 3.60B 5.62B 2.75B 1.79B 2.16B 1.32B 1.53B 3.20B 3.05B 3.70B
Total Liabilities 23.13B 16.37B 12.20B 12.61B 13.07B 12.56B 13.05B 15.00B 15.72B 16.05B
Stockholder' Equity -4.65B 4.37B 4.45B 4.64B 4.30B 3.99B 3.51B 3.38B 3.11B 3.27B
Current Ratio 1.26 1.34 1.49 1.92 1.65 2.15 1.87 1.32 1.34 1.20
TL-to-TA 1.25 0.79 0.73 0.73 0.75 0.76 0.79 0.82 0.83 0.83

Low or No Reinvestment of Profits over the past 10 years

CPN has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to CPN operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings -7.69B -7.69B -7.54B -7.51B -7.70B -7.50B -7.49B -6.54B -6.31B -6.21B
Retained Earnings Growth - -0.05% 1.94% 0.41% -2.53% 2.58% 0.19% 12.64% 3.59% 1.46%

Competitive Industry over the past 10 years

CPN is likely operating in an industry with medium to low barriers to entry. This may mean that CPN doesn't have a characteristic that's hard to replicate, such as exclusive distribution, branding or the ability to keep costs low. If Gross Margins are at least satisfactory, it's likely that CPN invests heavily in R&D and Sales, General & Administrative expenses.

Only $5.52 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 2.69B 10.00M 145.00M 31.00M -189.00M 199.00M 18.00M 961.00M 249.00M 111.00M
divided by
Revenue 7.97B 9.94B 6.56B 6.55B 6.80B 5.48B 6.30B 8.03B 6.47B 6.72B
Net Profit Margin 33.79% 0.10% 2.21% 0.47% -2.78% 3.63% 0.29% 11.97% 3.85% 1.65%

Satisfactory Pricing Power over the past 10 years

Consistency is vital. CPN has been able to maintain gross margins fairly consistently, which is a strong indication of their ability to raise prices with inflation. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$25.34 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 2.29B 2.66B 1.22B 1.70B 1.55B 1.53B 1.67B 2.17B 1.69B 1.55B
divided by
Revenue 7.97B 9.94B 6.56B 6.55B 6.80B 5.48B 6.30B 8.03B 6.47B 6.72B
Gross Margin 28.70% 26.73% 18.51% 26.02% 22.75% 27.97% 26.50% 27.01% 26.07% 23.11%

High Capital Intensity over the past 10 years

CPN spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

776.70% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 196.00M 143.00M 179.00M 369.00M 714.00M 649.00M 575.00M 492.00M 565.00M 489.00M
divided by
Net Income 2.69B 10.00M 145.00M 31.00M -189.00M 199.00M 18.00M 961.00M 249.00M 111.00M
Capital Expenditure Ratio 7.28% 1,430.00% 123.45% 1,190.32% -377.78% 326.13% 3,194.44% 51.20% 226.91% 440.54%

No Dividend History over the past 10 years

CPN has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 4.79B 4.86B 4.86B 487.29M 485.38M 471.34M 444.77M 409.36M 364.89M 356.11M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End - 6.60 11.06 13.33 16.33 17.75 19.47 22.31 14.21 11.43
Dividend Yield - - - - - - - - - -

Strong History of Stock Buybacks over the past 10 years

CPN has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 4.79B 4.86B 4.86B 487.29M 485.38M 471.34M 444.77M 409.36M 364.89M 356.11M
Stock Bought Back - -1.25% -0.16% 898.00% 0.39% 2.98% 5.97% 8.65% 12.19% 2.46%
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