Investment Analysis Report: IDA

Overview

In this investment analysis report, we will delve into a comprehensive analysis of IDA, a company operating in the Electric Utilities sector. We will analyze the company's financial health, earnings and revenue growth, profitability, operating margin, operating cash flow, capital expenditure trends, and efficiency. We will examine the latest annual and quarterly financial statements to provide insights into the company's performance and prospects.

Balance Sheets Analysis

Key Observations:

1. Total Assets: IDA's total assets have shown a consistent increase over the past three years, reaching $8.8 billion in 2023 from $7.6 billion in 2021. This indicates the company's growth and expansion.

2. Total Liabilities: The total liabilities have also increased steadily, reaching $5.9 billion in 2023 from $4.9 billion in 2021. This suggests that the company has taken on more debt to finance its operations.

3. Shareholders' Equity: Shareholders' equity has shown a positive trend, increasing from $2.7 billion in 2021 to $3.1 billion in 2023. This indicates that the company's net worth has been growing.

Opinions:

• IDA's balance sheet reflects a healthy growth trajectory, with increasing assets and shareholders' equity. However, the rising total liabilities indicate a higher debt burden, which could impact the company's financial flexibility in the long run.

Income Statements Analysis

Key Observations:

1. Total Revenue: IDA's total revenue has been steadily increasing over the past three years, reaching $1.77 billion in 2023 from $1.45 billion in 2021. This indicates the company's ability to generate consistent revenue growth.

2. Net Income: The net income has also shown a positive trend, increasing from $245.5 million in 2021 to $261.2 million in 2023. This suggests that the company has been able to maintain profitability.

3. Operating Income: Operating income has shown a slight increase over the years, reaching $339.5 million in 2023 from $339.5 million in 2021. This indicates stable operational performance.

Opinions:

• IDA's income statements reflect a positive revenue and net income growth trend, indicating the company's ability to generate profits and maintain operational efficiency. The consistent growth in total revenue is a positive sign for investors.

Cashflow Statements Analysis

Key Observations:

1. Operating Cash Flow: IDA's operating cash flow has fluctuated over the past three years, with a significant decrease in 2022. The company reported negative free cash flow in 2022, indicating challenges in generating cash from operations.

2. Ending Cash: The ending cash balance has shown variability, with a significant increase in 2023 compared to 2022. This suggests that the company may have improved its cash management practices.

3. Total Dividends: The total dividends paid to common and preferred stocks have increased over the years, reaching $163.5 million in 2023 from $146.1 million in 2021.

Opinions:

• IDA's cash flow statements reveal some challenges in generating positive operating cash flow, as evidenced by the negative free cash flow in 2022. The increase in total dividends paid indicates a commitment to rewarding shareholders, but the company needs to focus on improving cash flow generation.

Investment Analysis and Recommendations

Based on the analysis of IDA's financial statements, the company demonstrates strong revenue growth, profitability, and operational efficiency. However, the fluctuating operating cash flow and increasing debt levels raise concerns about the company's financial health and liquidity.

Valuation:

• IDA's market capitalization stands at $4.49 billion, reflecting the company's market value. The enterprise value is $7.11 billion, indicating the total value of the company's operations.

Financial Health:

• The company's balance sheet shows a healthy growth in total assets and shareholders' equity. However, the increasing total liabilities and debt levels raise concerns about the company's financial leverage.

Earnings and Revenue Growth:

• IDA has demonstrated consistent revenue growth over the past three years, indicating a strong business performance. The net income has also shown a positive trend, reflecting the company's profitability.

Profitability:

• The company's profitability metrics, such as net margin and EBITDA, indicate a stable and profitable operation. IDA has been able to maintain a healthy level of profitability despite challenges in cash flow generation.

Operating Margin and Operating Cash Flow Analysis:

• IDA's operating margin has remained relatively stable over the years, indicating efficient cost management. However, the fluctuating operating cash flow raises concerns about the company's ability to generate cash from operations.

Capital Expenditure Trends and Efficiency:

• The company's capital expenditure trends show a significant increase in 2022, which may have impacted the operating cash flow. IDA needs to focus on improving capital expenditure efficiency to enhance cash flow generation.

Overall Viewpoint: [Neutral]

• While IDA demonstrates strong revenue growth and profitability, the fluctuating operating cash flow and increasing debt levels raise concerns about the company's financial health. Investors should closely monitor the company's cash flow generation and debt management practices before making investment decisions.

In conclusion, IDA presents a mixed picture of financial performance, with strengths in revenue growth and profitability offset by challenges in cash flow generation and debt management. Investors should conduct further research and analysis to gain a deeper understanding of the company's fundamentals and market trends before making investment decisions.