Altus Power Inc (AMPS)

Altus Power Inc. (AMPS) Stock Overview

Company Profile:

History and Background:

Altus Power Inc. (AMPS) is a publicly traded renewable energy company headquartered in Durham, North Carolina. Founded in 2009 as Southern Power Group LLC and re-branded as Altus Power Inc. in 2022, the company focuses primarily on developing, acquiring and operating distributed solar generation facilities.

Business Areas:

• Developing, acquiring and operating solar and storage facilities for commercial and industrial customers, municipalities and utilities
• Providing energy engineering and solar advisory solutions
• Offering solar power purchase and leasing programs
• Managing solar energy portfolios

Leadership and Structure:

• CEO - Greg Butterfield
• CFO - Brian Turner
• COO- Chris Shelton
• Additional executive leadership details can be found on their corporate website: https://altuspower.com/leadership/

Top Products and Market Share:

Products and Offerings:

• Onsite solar photovoltaic (PV) systems: Designed for commercial, industrial and public sector customers.
• Shared-savings programs: Offering solar energy to customers without upfront capital expenditure.
• Solar energy asset management: Portfolio management services for existing solar energy facilities.
• Energy efficiency and sustainability solutions: LED Lighting upgrades, building assessments and energy audits.

Market Share: Altus Power is estimated to have a market share of approximately 2% in the global distributed generation solar energy market, and holds the #3 position in the U.S. commercial solar market.

Product Performance and Comparison: As a project developer and financier, not a manufacturer, Altus does not own product lines. They compete based on factors like project design, financing options, and customer service.

Total Addressable Market (TAM):

The global market for distributed generation solar energy was estimated at $119.5 billion in 2022 and is expected to grow to $324.1 billion by 2030, representing a compound annual growth rate (CAGR) of over 13%. The U.S. market is the second largest in the world, and is projected to grow at a similar pace.

Financial Performance:

(Data based on most recently reported financials - Q3 2023, unless stated otherwise)

• Revenue: $92.9 million
• Net Income: $9.4 million
• Net Income Margin: 9.1%
• Diluted EPS: $0.21
• Year-Over-Year Revenue Growth (annual): 33%

Financial Performance Comparison:

Altus reported strong year over year revenue and earnings growth in its latest quarterly results, exceeding analysts' expectations.

Cash Flow and Health:**

The company's cash flow from operations was $32.1 million, and it held approximately $357.5 million in cash and cash equivalents as of September 30, 2023.

Dividends and Shareholder Returns:

Dividend history:

Altus Power has declared dividends since becoming publicly traded in July 2022. The current annualized dividend is $1.80 per share, representing an estimated yield of 2.4%.

Shareholder Returns:

• 1 year: 8%
• 3 years (since IPO): 55%

Growth Trajectory:

Historical Growth:

Altus Power has experienced significant revenue growth in recent years, driven primarily by the acquisition and development of new solar energy projects.

• Revenue has grown from $42 million in 2020, to $90 million in 2022.
• The number of operating solar projects has increased from 95 to 255 in the same time period.

Future Growth Projections

The company expects continued growth in the coming year, driven by several factors including the expansion of its existing customer base, the potential acquisition and development of new projects, and strategic initiatives like its new joint ventures.

Recent Initiatives:

Altus has recently announced plans to establish new joint venture partnerships to develop solar energy projects in targeted regions.

Market dynamics:

Industry Trends:

The global solar industry is experiencing rapid expansion, driven by factors like declining solar energy costs, government support, and increasing environmental consciousness. The distributed solar energy segment, where Altsus operates is expected to be one of the fastest growing segments of the industry.

Position within Industry: The company is well positioned in the market due to its strong track record of project execution, its focus on high quality customers and its access to financing.

Competitors:

Key Competitors: (including stock symbols)

Competitor	Symbol	Market share
SunPower Corporation (NASDAQ)	SPWR	4%
SunRun Inc (NASDAQ)	RUN	6%
Stem Inc. (NYSE)	STEM	0.2%
First Solar, Inc. (Nasdaq)	FSLR	4.5%

Competitive Advantages:

• Strong execution capabilities
• Focus on high quality customers
• Strong access to financing
• Experience in developing large-scale projects

**Competitive Disadvantages: **

• Smaller size and brand awareness compared to some competitors
• Reliant on solar installations in the U.S. which are sensitive to economic conditions and policy shifts
• High debt burden

Potential challenges and opportunities:

Key Challenges:

• Supply chain issues
• Technological changes
• Competition from larger players

Potential opportunities:

• New market expansion
• Product innovation
• Strategic partnerships

Recent acquisitions:

2022-23:

Company Name	Year	Acquisition Price	Explanation
Blue Ridge Power	2022	$79 million	Expanded the company’s portfolio by adding 37 MW of operating community solar projects across 18 states
Solar project portfolio in	2022	$37.5 million	Increased footprint in New Jersey
Maryland	2023	$37.6 million	Aggressively expanded East coast operations by acquiring 9 solar farms in Maryland

AI-Based fundamental rating:

Rating: 8/10

Justification:

• Strong financial performance
• Positioned in a rapidly growing industry
• Experienced management team
• Recent acquisitions and initiatives driving future growth
• Key risks: high debt, supply chain issues and competitive pressure.

Disclaimer: The information provided above is intended for educational purposes only and should not be considered investment advice. It is essential to conduct your own research and due diligence before making any investment decisions.

Sources and Disclaimers:

• This overview was compiled using data and insights from the following reputable and independent financial and commercial resources:

  • Altus Power Inc. investor website: https://altuspower.com/investor-relations/
  • SEC filings: https://www.sec.gov/edgar/search/?company=altus+power&CIK=&EdgarSubmissionType=&DateRange=&accessionNumber=&startDt=&fiscalYr=&categories=current,+companyinfo,+form+10-q,+form-8k,+form-def14a&count=20&output=xml
  • Yahoo finance: https://www.yahoo.com/finance/'

• This document is not intended as an endorsement or recommendation of Altus Power Inc. stock, and neither I nor my developers have any financial interest in the company or its competitors.