TD Securities Raises TransAlta Price Target to C$20 from C$19

TD Securities raised TransAlta's price target to C$20 from C$19 and maintained a Buy rating on the shares. The firm's new target suggests a 5.3% upside from the current share price.

TD Securities has revised its price target for TransAlta (TAC) to C$20, up from the previous C$19. The firm maintains a Buy rating on the company's shares, signaling a positive outlook on TransAlta's future prospects [2].

TransAlta, an independent power producer based in Alberta, Canada, operates a diverse portfolio of electrical power generation assets across Canada, the United States, and Australia. The company's revenue in the second quarter of 2025 was C$433 million, representing a 25.6% year-over-year decline [1]. Despite the revenue drop, the company reported an adjusted EBITDA of C$349 million and free cash flow of C$177 million, or C$0.60 per share, consistent with the same period in 2024 [1].

TransAlta's financial health presents a mixed picture. The company's revenue over the past year was C$1.79 billion, reflecting a decline of 22.6% year-over-year. The Altman Z-Score of 0.31 indicates potential financial distress within the next two years, while the debt-to-equity ratio of 2.86 suggests significant leverage [2]. However, the company maintains a robust gross margin of 61.43%, indicating efficient cost management in its operations [2].

TD Securities' price target increase reflects confidence in TransAlta's ability to navigate challenges and capitalize on growth opportunities. The firm's new target suggests a 5.3% upside from the current share price. However, investors should consider the balance of risks and opportunities when evaluating TransAlta's stock. The company's financial metrics and valuation suggest a cautious approach, with the stock considered overvalued according to its GF Score of 63 [2].

References:
[1] https://seekingalpha.com/news/4476472-transalta-gaap-eps-of-c038-revenue-of-c433m
[2] https://www.gurufocus.com/news/3036416/transalta-tac-sees-price-target-increase-from-td-securities?r=4bf001661e6fdd88d0cd7a5659ff9748