Clearway Energy (CWEN, Financial) experienced a downgrade from CIBC, shifting its rating from Outperform to Neutral. The financial institution has set a price target of $35 for the stock. Investors following CWEN should take note of this adjustment, as it may influence their investment decisions.
CWEN Key Business Developments
Release Date: April 30, 2025
- Adjusted EBITDA: $252 million for the first quarter.
- Cash Available for Distribution (CAFD): $77 million for the first quarter.
- Renewable & Storage Segment Capacity Factors: Solar improved by 4.7% to 25.7%; Wind improved by 2.9% to 33.9%.
- Flexible Generation Availability: Improved by 3% to 89.3%.
- 2025 CAFD Guidance Range: Reiterated at $400 million to $440 million, targeting the higher end.
- Retained CAFD (2025-2027): Expected to generate $250 million or more.
- Excess Debt Capacity: Estimated at approximately $400 million or greater.
- Corporate Debt-to-EBITDA Ratio Target: 4 to 4.5 times.
- Interest Rate Hedging: Forward-starting hedges executed for the majority of the $850 million corporate bonds maturing in 2028.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Clearway Energy Inc (CWEN, Financial) delivered solid first quarter results across all segments, reaffirming its 2025 guidance range.
- The company made accretive progress in fleet enhancements, sponsor-enabled drop-down investments, and asset-centered third-party M&A.
- Clearway Energy Inc (CWEN) signed a revenue contract with Microsoft for the Mt. Storm repowering project, advancing towards construction in 2025.
- The company closed the Tuolumne Wind acquisition and signed a binding agreement to acquire an operational solar project in California.
- Clearway Energy Inc (CWEN) mitigated interest rate risk for refinancing its corporate bond maturing in 2028 through opportunistic hedging.
Negative Points
- The company faces potential challenges with tariff impacts on battery storage projects, which may require cost-sharing or sourcing from non-Chinese suppliers.
- There is uncertainty regarding the future of the IRA and potential changes in policy that could affect project economics.
- Clearway Energy Inc (CWEN) may need to issue modest amounts of equity through an ATM facility to fund growth, which could dilute existing shareholders.
- The company is exposed to risks related to permitting and regulatory changes for its repowering projects.
- Clearway Energy Inc (CWEN) must navigate a competitive M&A market, requiring rigorous and selective evaluation of opportunities.
