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Manawa Energy Ltd MNW

Morningstar Rating
NZD 4.38 +0.08 (1.86%)
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Company Report

NZ Utilities: New Zealand Aluminium Smelters to Operate Until 2044

In a positive for the utilities, Rio Tinto has agreed to electricity supply contracts to operate New Zealand Aluminium Smelters until Dec. 31, 2044. The smelter, which accounts for about 13% of New Zealand’s electricity demand, threatened to close in 2020 because of weak aluminum prices, and its future remained uncertain until this announcement. Its closure would likely have caused much lower wholesale electricity prices for the medium term, hurting utility earnings.

Price vs Fair Value

MNW is trading at a 199% premium.
Price
NZD 4.38
Fair Value
NZD 4.50
Uncertainty
Medium
1-Star Price
NZD 8.62
5-Star Price
NZD 3.23
Economic Moat
Tybzw
Capital Allocation
Xrbhpfvx

Bulls Say, Bears Say

Bulls

High wholesale prices and the CPI-linked contract with Mercury underpin good earnings growth potential in the medium term, aided by investment to increase generation output.

Bears

Manawa faces volatility from hydrological conditions. Weak hydrology, caused by significantly lower inflows and lake levels, can adversely affect the generation business.

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Trading Information

Previous Close Price
NZD 4.30
Day Range
NZD 4.284.38
52-Week Range
NZD 4.025.05
Bid/Ask
NZD 4.30 / NZD 4.40
Market Cap
NZD 1.37 Bil
Volume/Avg
28,937 / 63,698

Key Statistics

Price/Earnings (Normalized)
20.75
Price/Sales
5.22
Dividend Yield (Trailing)
4.44%
Dividend Yield (Forward)
5.14%
Total Yield
4.44%

Company Profile

Manawa is New Zealand's fifth-largest electricity generator. It has about 26 hydroelectric schemes in New Zealand, producing more than 1,900 GWh of electricity in an average rainfall year. Manawa's retail business was sold in 2022. Most electricity is sold to Mercury NZ under a long-term contract.
Sector
Utilities
Industry
Utilities - Renewable
Stock Style Box
Small Core
Total Number of Employees
143

Competitors

Valuation

Metric
MNW
MEL
CEN
Price/Earnings (Normalized)
20.7555.1923.75
Price/Book Value
1.122.822.68
Price/Sales
5.224.392.97
Price/Cash Flow
14.2730.3813.50
Price/Earnings
MNW
MEL
CEN

Financial Strength

Metric
MNW
MEL
CEN
Quick Ratio
0.370.670.61
Current Ratio
1.130.940.86
Interest Coverage
2.861.756.27
Quick Ratio
MNW
MEL
CEN

Profitability

Metric
MNW
MEL
CEN
Return on Assets (Normalized)
3.04%0.79%4.95%
Return on Equity (Normalized)
5.18%1.34%10.49%
Return on Invested Capital (Normalized)
4.85%1.00%5.26%
Return on Assets
MNW
MEL
CEN
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