TransAlta Corporation (TAC) AI Stock Analysis

TransAlta Corporation owns, operates, and develops electrical power generation assets in Canada, the United States, and Australia. The company operates through four primary segments: Hydro, Wind and Solar, Gas, and Energy Transition. Its infrastructure includes hydroelectric, wind, solar, natural gas-fired, and coal-fired generation assets. TransAlta also conducts wholesale trading of electricity and related energy commodities and derivatives, alongside mining operations and natural gas pipeline activities. It serves municipalities, industrial clients, commercial businesses, and utility customers.

TransAlta grew annual revenue from $2.72B in FY2021 to a peak of $3.35B in FY2023, before declining to $2.85B in FY2024 and $2.40B in FY2025. Net income fluctuated widely, moving from -$537.0M in FY2021 to $695.0M in FY2023, and falling to -$137.9M in FY2025. Gross margin contracted to 32.6% in FY2025 from 63.1% in FY2024, while operating margin turned to -9.2%. Over the 5-year span from FY2020 to FY2025, revenue compound annual growth rate stood at 2.7%. For the quarter ended June 30, 2026, quarterly revenue increased 12.5% year-over-year, while quarterly earnings dropped 71.6%.

As of June 30, 2026, TransAlta reported $302.0M in cash and short-term investments alongside total debt of $4.24B, resulting in net debt of $3.94B. Shareholders' equity was $1.78B, leading to a debt-to-equity ratio of 2.38, while the current ratio stood at 0.84. In FY2025, the company generated operating cash flow of $645.5M and free cash flow of $396.7M. TransAlta allocated $248.8M to capital expenditures, paid $125.9M in dividends, and executed $24.0M in share buybacks during FY2025.

At $12.85 per share, TransAlta carries a market capitalization of $4.06B and an enterprise value of $7.26B. Its forward price-to-earnings multiple of 26.6x sits above the 17.2x median of its US-listed Utilities peers, and its EV/EBITDA of 13.4x compares to the peer median of 12.1x. Its price-to-sales multiple is 1.8x, lower than the peer median of 2.4x. Over the past year, TransAlta shares dropped 23.1%, lagging the 16.8% return for the S&P 500.

TransAlta pays a quarterly dividend with a forward annualized payout of $0.20 per share, offering a dividend yield of 1.53%. The company maintains a 26-year track record of consecutive dividend payments, supported by a 5-year annualized dividend growth rate of 7.4% and an annual payout ratio of 1.8%. Its most recent ex-dividend date was September 1, 2026.

TransAlta is covered by 11 Wall Street analysts, with 5 Strong Buy, 4 Buy, 1 Hold, and 1 Sell ratings. The consensus mean price target is $13.09, representing a 1.8% premium over the closing price of $12.85 on October 16, 2026. For FY2026, consensus estimates project EPS of $0.33 on revenue of $2.11B. TransAlta has beaten EPS estimates in 2 of the past 4 quarters, with its next earnings report scheduled for November 3, 2026.

This page is an AI-written research summary of TransAlta Corporation (TAC). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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