GET DAILY SIGNALSTransAlta (TAC) Returns to Profit in Q3 Despite Softer Revenue
Key Takeaways
- TransAlta reported net earnings attributable to common shareholders of C$63 million, or C$0.20 per diluted share, reversing a net loss of C$62 million, or (C$0.20) per share, in the same period a year earlier.
- Revenue totaled C$536 million, down from C$615 million in the third quarter of 2025, reflecting the low merchant power price environment in Alberta.
- Adjusted EBITDA reached C$264 million, with free cash flow of C$93 million, or C$0.29 per share.
- Management reaffirmed its full-year 2026 guidance and declared a quarterly dividend of C$0.07 per share.
- Average fleet availability was 92.6%, and the company's hedging and optimization strategy generated realized power prices well above Alberta spot prices.
Why These Results Matter
TransAlta's third-quarter 2026 results offer a useful test of how the company can generate cash in a persistently soft Alberta merchant power market. A year ago it posted a loss, so investors have been watching to see whether its hedging program, fleet diversification, and asset-optimization capabilities can protect profitability when spot electricity prices remain weak. The quarter also coincides with major portfolio moves, including the US$1 billion acquisition of two contracted natural gas-fired peaking facilities in Colorado and the sale of a 49% stake in its Oklahoma wind portfolio. Together these updates provide a read on near-term earnings resilience and the credibility of full-year guidance.
The Numbers Behind the Quarter
For the quarter ended September 30, 2026, TransAlta reported net earnings attributable to common shareholders of C$63 million, or C$0.20 per diluted share, compared with a net loss of C$62 million, or (C$0.20) per share, in the prior-year period. On an adjusted basis, earnings were C$0.18 per share, up from an adjusted loss of C$0.02 per share a year earlier. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Revenue came in at C$536 million, down from C$615 million in the third quarter of 2025. Free cash flow was C$93 million, or C$0.29 per share, compared with C$105 million, or C$0.35 per share, a year ago. Funds from operations totaled C$146 million, or C$0.46 per share, versus C$156 million, or C$0.53 per share, in 2025. Adjusted EBITDA was C$264 million, and adjusted earnings before income taxes improved sharply to C$91 million from C$17 million a year earlier. Average fleet availability held at 92.6%. Management reaffirmed its 2026 guidance, citing strong hedging positions and consistent fleet optimization as sources of stable core cash flow even in a low-price environment.
Market Response
The market's initial reaction was measured but constructive. Shares traded modestly higher in early North American trading, reflecting relief that the company returned to profitability and held its full-year guidance despite a softer revenue environment. The sharp year-over-year swing from a net loss to a net profit, combined with the reaffirmed outlook, appeared to reinforce confidence in the hedging strategy and fleet optimization. Still, sentiment remains tempered by weaker Alberta spot power prices and the continued decline in top-line revenue, factors investors are weighing against growth initiatives in U.S. contracted generation and Alberta data center development.
Looking Ahead
Investors will be focused on whether TransAlta can convert its strategic initiatives into sustained cash-flow growth. The company reaffirmed its 2026 guidance and highlighted a strong hedge book, with a meaningful portion of its Alberta generation hedged at prices above current forward levels. This provides some near-term visibility, but the trajectory of Alberta power prices remains a key swing factor.
Several catalysts are worth monitoring. TransAlta is advancing its coal-to-gas conversion at the Centralia facility in Washington and expects to receive environmental permits by year-end, with a final investment decision targeted for 2027. The company is also progressing its Alberta data center strategy through the Boreal Technology Hub project at Keephills, where it serves as the exclusive land and power provider.
Balance-sheet moves will also be in focus. The completed sale of a 49% interest in the Oklahoma wind portfolio for US$305 million and the US$1 billion Colorado peaking-facility acquisition reshape the portfolio toward contracted cash flows. Meanwhile, the decision to mothball Battle River Units 4 and 5 and extend the Sundance 6 outage reflects a deliberate effort to preserve optionality until market fundamentals or contracting opportunities improve. Investors should watch how these repurposing and asset-recycling efforts translate into earnings quality and free cash flow in the quarters ahead.
Using AI Tools in My Research
One tool I find particularly useful for this kind of analysis is Tickeron’s AI Screener. It helps me quickly filter energy and utility names using technical patterns, fundamentals, and AI-driven signals so I can compare TransAlta against peers and monitor shifting market conditions without spending hours on manual screens. The customizable filters make it easy to surface relevant candidates and stay on top of sector trends.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
TAC sees its Stochastic Oscillator climbs out of oversold territory
On October 28, 2026, the Stochastic Oscillator for TAC moved out of oversold territory and this could be a bullish sign for the stock. Traders may want to buy the stock or buy call options. Tickeron's A.I.dvisor looked at 62 instances where the indicator left the oversold zone. In 42 of the 62 cases the stock moved higher in the following days. This puts the odds of a move higher at over 68%.
Technical Analysis (Indicators)
Bullish Trend Analysis
TAC moved above its 50-day moving average on October 27, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for TAC crossed bullishly above the 50-day moving average on October 08, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 10 of 17 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 59%.
Following a +2.64% 3-day Advance, the price is estimated to grow further. Considering data from situations where TAC advanced for three days, in 182 of 288 cases, the price rose further within the following month. The odds of a continued upward trend are 63%.
TAC may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In 119 of 188 cases where TAC Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 63%.
Bearish Trend Analysis
The 10-day RSI Indicator for TAC moved out of overbought territory on October 07, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 33 similar instances where the indicator moved out of overbought territory. In 24 of the 33 cases, the stock moved lower in the following days. This puts the odds of a move lower at 73%.
The Momentum Indicator moved below the 0 level on November 02, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on TAC as a result. In 62 of 90 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 69%.
The Moving Average Convergence Divergence Histogram (MACD) for TAC turned negative on November 02, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 47 similar instances when the indicator turned negative. In 36 of the 47 cases the stock turned lower in the days that followed. This puts the odds of success at 77%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TAC declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 70%.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of 30 (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: TAC's P/B Ratio (4.814) is slightly higher than the industry average of (2.063). TAC's P/E Ratio (-41.194) is considerably lower than the industry average of (14.957). Projected Growth (PEG Ratio) (1.140) is also within normal values, averaging (1.785). Dividend Yield (0.016) settles around the average of (0.053) among similar stocks. P/S Ratio (0.713) is also within normal values, averaging (187.392).
The Tickeron PE Growth Rating for this company is 39 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is 50 (best 1 - 100 worst), indicating steady price growth. TAC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 76 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. TAC’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 50, placing this stock worse than average.
The Tickeron SMR rating for this company is 94 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Advertisement
General Information
a company that generates and distributes electricity
Industry ElectricUtilities
Advertisement