Breaking Down Clearway Energy, Inc. (CWEN) Financial Health: Key Insights for Investors

Are you an investor keeping a close watch on the energy sector? Have you been following Clearway Energy, Inc. (CWEN) and wondering about its financial stability and future prospects? In 2024, the company reported a net loss of $63 million, but don't let that number tell the whole story. The company also saw an adjusted EBITDA of $1,146 million and a cash available for distribution (CAFD) of $425 million. With a total debt of $7.74 billion and significant investments in renewable energy projects, understanding the complete financial picture is crucial. So, let's dive into the key insights that can help you make informed decisions about Clearway Energy.

Clearway Energy, Inc. (CWEN) Revenue Analysis

Understanding Clearway Energy, Inc.'s (CWEN) revenue streams is crucial for investors seeking insights into the company's financial health and future prospects. A detailed breakdown of revenue sources, growth rates, and segment contributions provides a comprehensive view of the company's financial performance.

Clearway Energy, Inc. reported full year 2024 financial results, including a Net Loss of $63 million, Adjusted EBITDA of $1,146 million, Cash from Operating Activities of $770 million, and Cash Available for Distribution (CAFD) of $425 million.

Here's a breakdown of Clearway Energy, Inc.'s (CWEN) revenue streams:

• Primary Revenue Sources: Clearway Energy, Inc. generates revenue primarily through energy revenue and capacity revenue. For the three months ended September 30, 2024, energy revenue was $350 million ($315 million from Renewables and $35 million from Conventional Generation), and capacity revenue was $87 million ($22 million from Renewables and $65 million from Conventional Generation).
• Year-Over-Year Revenue Growth: In 2024, Clearway Energy had annual revenue of $1.37 billion, representing a 4.34% growth compared to the previous year. The annual revenue for 2023 was $1.314 billion, which was a 10.42% increase from 2022.
• Historical Revenue Trends:
  • 2024: $1.371 billion (4.34% increase)
  • 2023: $1.314 billion (10.42% increase)
  • 2022: $1.19 billion (7.47% decrease)
  • 2021: $1.29 billion (7.26% increase)
  • 2020: $1.20 billion (16.18% increase)
• Business Segment Contribution: Clearway Energy, Inc. operates through two primary segments: Conventional Generation and Renewables. The Renewables segment accounted for 96% of the company's total generation in 2024.
• Significant Changes in Revenue Streams: Adjusted EBITDA results were higher than 2023 primarily due to lower renewable production in the prior year and the contribution of growth investments in 2024 partially offset by the expiration of certain tolling agreements in the Flexible Generation fleet.

Here is a table summarizing Clearway Energy, Inc.'s (CWEN) Revenue from 2011 to 2024:

For more insights into Clearway Energy, Inc.'s (CWEN) strategic objectives, see Mission Statement, Vision, & Core Values of Clearway Energy, Inc. (CWEN).

Clearway Energy, Inc. (CWEN) Profitability Metrics

Analyzing Clearway Energy, Inc. (CWEN)'s profitability involves examining several key metrics to understand the company's financial health and operational efficiency. These metrics include gross profit, operating profit, and net profit margins, which provide insights into how effectively the company manages its costs and generates earnings from its revenue.

To thoroughly evaluate Clearway Energy, Inc. (CWEN)'s financial performance, it's essential to delve into specific profitability metrics. Here's an overview:

• Gross Profit: Assesses the direct profitability of Clearway Energy, Inc. (CWEN)'s projects before considering overheads.
• Operating Profit: Reflects earnings after deducting operating expenses, showcasing the profitability of core business operations.
• Net Profit: Represents the final profit after all expenses, including interest and taxes, are accounted for, indicating overall profitability.

Clearway Energy, Inc. (CWEN) reported a gross profit of $884 million for the fiscal year 2024. The operating income stood at $269 million. However, the net loss attributable to Clearway Energy, Inc. was $147 million. These figures provide a snapshot of the company's earnings at different stages of the income statement.

When evaluating Clearway Energy, Inc. (CWEN)'s financial standing, comparing its profitability ratios with industry averages is crucial. This benchmarking exercise helps determine whether the company is performing on par with its competitors. If Clearway Energy, Inc. (CWEN)'s profit margins surpass the industry benchmarks, it could signify superior operational efficiency or a strategic advantage. Conversely, lower margins may indicate areas needing improvement, such as cost management or revenue generation.

Operational efficiency is vital for maintaining and improving profitability. Effective cost management and positive gross margin trends are indicators of a well-run company. For instance, consistent or increasing gross margins suggest that Clearway Energy, Inc. (CWEN) is managing its production costs effectively, potentially through economies of scale, technological improvements, or favorable supply contracts. Close monitoring of these trends can provide insights into the sustainability of Clearway Energy, Inc. (CWEN)'s profitability.

Here is a table summarizing Clearway Energy, Inc.'s profitability metrics for the fiscal year 2024:

To gain more insights into Clearway Energy, Inc. (CWEN) and its investors, check out: Exploring Clearway Energy, Inc. (CWEN) Investor Profile: Who’s Buying and Why?

Clearway Energy, Inc. (CWEN) Debt vs. Equity Structure

Understanding how Clearway Energy, Inc. (CWEN) finances its operations and growth is crucial for investors. This involves looking at its debt levels, debt-to-equity ratio, and how it balances debt and equity funding. For more insights, you might find this resource helpful: Breaking Down Clearway Energy, Inc. (CWEN) Financial Health: Key Insights for Investors.

Here's a breakdown:

Overview of Debt Levels:

• Long-Term Debt: As of September 30, 2024, Clearway Energy's long-term debt was reported at $6.732 billion. This represents a 3.76% year-over-year decrease.
• For the fiscal year 2023, the company’s long-term debt was $7.479 billion, which is a 15.22% increase compared to 2022.

Debt-to-Equity Ratio:

• For December 2024, CWEN.A's debt-to-equity ratio was 1.39.
• Clearway Energy has a total shareholder equity of $5.6 billion and a total debt of $6.6 billion, bringing its debt-to-equity ratio to 118.1%.
• A net debt to equity ratio of 111.5% is considered high.
• The company's debt-to-equity ratio has decreased from 266% to 118.1% over the past 5 years.

Recent Debt Activities:

• In September 2021, Clearway Energy, through its affiliate, entered into a $335 million secured bridge loan facility to finance its purchase of a 50% interest in Utah Solar. This bridge facility is intended to be repaid using the proceeds from future financing activities.
• S&P Global Ratings assigned a 'BB' issue-level rating to Clearway Energy Operating LLC's $925 million senior unsecured notes offering in March 2021 and a 'BB' rating to their $350 million senior unsecured notes in September 2021.
• In December 2019, S&P Global Ratings assigned a 'BB' issue-level rating to Clearway Energy Operating LLC's $600 million senior unsecured notes offering, which was used to repay the $500 million 2024 senior unsecured notes.

Credit Ratings:

• S&P Global Ratings has assigned a 'BB' issue-level rating to Clearway Energy Operating LLC's senior unsecured notes.
• In December 2021, S&P Global Ratings affirmed the 'BB' ratings on Clearway Energy Inc., with a stable outlook.

Balancing Debt and Equity:

• Clearway Energy strategically uses both debt and equity to fund its growth. Debt financing, while potentially imposing additional cash payment obligations and operating restrictions, can provide necessary capital for acquisitions and project development.
• The company also focuses on optimizing its balance sheet through refinancing activities and managing its liquidity position to meet financial commitments and fund distributions.
• In 2023, Clearway Energy committed to approximately $215 million of new long-term corporate capital investments.
• In 2024, the company committed to approximately $450 million in new long-term corporate capital investments.

Financial Ratios:

Clearway Energy's approach to balancing debt and equity is crucial for sustaining its operations and achieving long-term financial health. Effective management of its debt levels and strategic use of equity funding are key to its growth and stability in the energy sector.

Clearway Energy, Inc. (CWEN) Liquidity and Solvency

Liquidity is crucial for understanding Clearway Energy, Inc.'s (CWEN) ability to meet its short-term obligations. Analyzing key financial ratios and cash flow trends provides insights into the company's financial health. For a broader view, check out: Breaking Down Clearway Energy, Inc. (CWEN) Financial Health: Key Insights for Investors.

Here's a detailed look at Clearway Energy, Inc.'s (CWEN) liquidity:

Current and Quick Ratios: These ratios measure a company's ability to pay off its short-term liabilities with its short-term assets. A higher ratio generally indicates better liquidity.

• Current Ratio: The current ratio is calculated by dividing current assets by current liabilities.
• Quick Ratio: The quick ratio, also known as the acid-test ratio, excludes inventory from current assets, providing a more conservative measure of liquidity.

As of the fiscal year 2024, Clearway Energy, Inc.'s (CWEN) liquidity positions can be assessed using these metrics. However, specific numerical data for 2024 was not available in the search results. For the most accurate and up-to-date figures, consulting their latest financial statements is essential.

Analysis of Working Capital Trends: Working capital, the difference between a company's current assets and current liabilities, is a key indicator of short-term financial health. Trends in working capital can reveal whether a company is efficiently managing its short-term resources.

Cash Flow Statements Overview: Analyzing cash flow statements provides a clear picture of how Clearway Energy, Inc. (CWEN) generates and uses cash. The cash flow statement is divided into three main sections:

• Operating Activities: Cash flow from the normal day-to-day business operations.
• Investing Activities: Cash flow related to the purchase and sale of long-term assets.
• Financing Activities: Cash flow related to debt, equity, and dividends.

Reviewing these cash flow trends helps investors understand the sustainability of Clearway Energy, Inc.'s (CWEN) operations and its ability to fund future growth.

Potential Liquidity Concerns or Strengths: Identifying potential liquidity concerns or strengths involves analyzing the trends and ratios discussed above. For instance, a declining current ratio or negative operating cash flow could signal potential liquidity issues. Conversely, a strong current ratio and positive operating cash flow would indicate solid liquidity.

Without specific 2024 data, a general framework for assessing Clearway Energy, Inc.'s (CWEN) liquidity includes:

For a complete picture of Clearway Energy, Inc.'s (CWEN) financial health, investors should consult the company's official financial statements and reports.

Clearway Energy, Inc. (CWEN) Valuation Analysis

Assessing whether Clearway Energy, Inc. (CWEN) is overvalued or undervalued involves examining several key financial ratios and indicators. Here's a breakdown based on the latest available data:

Price-to-Earnings (P/E) Ratio:

• The trailing P/E ratio as of December 31, 2024, is 35.55.
• The forward P/E ratio is 19.68.
• Nasdaq reports a P/E ratio of 38.97 for 2024.
• Clearway Energy's P/E ratio as of March 25, 2025, was 40.59, which is a 22.44% increase compared to its 12-month average of 33.15.
• As of April 15, 2025, the P/E ratio is 38.76, based on an EPS of $0.75 and a stock price of $29.07.
• eToro reports a P/E ratio of 38.79.

Price-to-Book (P/B) Ratio:

• The price-to-book ratio as of December 31, 2024, is 1.48.
• As of March 30, 2025, the price/book ratio is 1.1.
• The average price/book ratio for 2024 was 0.95, an 18.8% increase from 2023.

Enterprise Value-to-EBITDA (EV/EBITDA) Ratio:

• The EV/EBITDA ratio as of December 31, 2024, is 11.27.
• Clearway Energy's EV/EBITDA ratio is 13.5x.

Stock Price Trends:

• The 52-week high is $29.23 and the 52-week low is $21.03.
• As of April 9, 2025, the latest closing stock price is $28.05.
• The 52-week high is $31.09 and the 52-week low is $21.71.

Dividend Yield and Payout Ratios:

• Clearway Energy pays a dividend of $1.681 per share, with an annual dividend yield of 6%.
• The quarterly dividend was increased to $0.4312 per share, or $1.7248 per share annualized, a 1.7% increase over the previous quarter.
• The dividend payout ratio is 220.61%.

Analyst Consensus:

• The consensus rating is 'Buy.'
• The average price target from analysts is $34.33, with a high estimate of $38.00 and a low estimate of $30.00.

Here's a summary of Clearway Energy's key valuation metrics as of December 2024:

For additional insights into Clearway Energy, Inc., you might find this resource helpful: Mission Statement, Vision, & Core Values of Clearway Energy, Inc. (CWEN).

Clearway Energy, Inc. (CWEN) Risk Factors

Clearway Energy, Inc. (CWEN) faces a variety of risks that could significantly impact its financial health. These risks stem from both internal and external factors, encompassing industry competition, regulatory changes, market conditions, and specific operational and financial challenges.

One of the primary external risks is the evolving landscape of the renewable energy sector. Changes in government regulations, such as tax incentives or mandates for renewable energy, can directly affect Clearway Energy's profitability and growth prospects. Increased competition from other renewable energy companies, as well as traditional energy sources, can also put pressure on pricing and market share. Market conditions, including fluctuations in interest rates and commodity prices, can impact the cost of financing projects and the revenue generated from energy sales.

Operational risks include the performance and reliability of Clearway Energy's assets, such as solar and wind farms. Equipment failures, natural disasters, or other unforeseen events can disrupt operations and lead to decreased energy production. Financial risks involve managing debt levels, securing financing for new projects, and maintaining stable cash flows. Strategic risks may arise from decisions related to acquisitions, divestitures, or investments in new technologies.

Clearway Energy's most recent filings, particularly its 2024 annual report on Form 10-K, detail specific risks that the company believes could materially affect its business, financial condition, and operating results. These risks are categorized and discussed in detail, providing investors with valuable insights into the challenges facing the company. The filings also outline mitigation strategies or plans that Clearway Energy has in place to address these risks, such as diversifying its asset base, hedging against commodity price fluctuations, and maintaining insurance coverage.

For instance, Clearway Energy's exposure to interest rate fluctuations is a notable financial risk. With a substantial amount of debt, changes in interest rates can significantly impact the company's borrowing costs and overall profitability. To mitigate this risk, Clearway Energy may use hedging strategies, such as interest rate swaps, to lock in fixed rates and reduce its exposure to market volatility. Additionally, Clearway Energy's reliance on specific counterparties for energy sales agreements exposes it to credit risk. If a major customer defaults on its obligations, it could negatively impact Clearway Energy's revenue and cash flow. To manage this risk, Clearway Energy carefully evaluates the creditworthiness of its counterparties and may require collateral or other forms of security.

Below is a summary of potential risks that Clearway Energy, Inc. (CWEN) might face:

• Regulatory and Policy Changes: Changes in renewable energy mandates, tax incentives, or environmental regulations can significantly impact the economic viability of projects.
• Market Conditions: Fluctuations in electricity prices, interest rates, and commodity prices can affect revenue and project financing costs.
• Operational Risks: Equipment failures, natural disasters, or other unforeseen events can disrupt energy production and increase costs.
• Counterparty Risk: Reliance on specific customers or suppliers exposes the company to potential defaults or contract disputes.
• Financing Risks: The ability to secure financing for new projects or refinance existing debt is crucial for growth and can be affected by market conditions and credit ratings.

Investors can keep an eye on the risk factors detailed in SEC filings, which offer information on the company's strategy for navigating these challenges. By understanding these risks and mitigation strategies, investors can make more informed decisions about investing in Clearway Energy, Inc. (CWEN). For further insights, explore Exploring Clearway Energy, Inc. (CWEN) Investor Profile: Who’s Buying and Why?

Clearway Energy, Inc. (CWEN) Growth Opportunities

Clearway Energy, Inc. (CWEN) possesses several key growth drivers that underpin its future prospects. These include a focus on renewable energy projects, strategic acquisitions, and market expansions. The company's commitment to sustainability and clean energy positions it favorably in a market increasingly driven by environmental concerns and regulatory support for renewable energy.

Analysis of key growth drivers for Clearway Energy, Inc. (CWEN):

• Renewable Energy Focus: Clearway Energy, Inc. (CWEN) is strategically positioned to capitalize on the increasing demand for renewable energy.
• Strategic Acquisitions: Clearway Energy, Inc. (CWEN) has a track record of making strategic acquisitions to expand its portfolio of assets and increase its revenue base.
• Market Expansion: Clearway Energy, Inc. (CWEN) is actively expanding its presence in key markets across the United States.

Future revenue growth projections and earnings estimates for Clearway Energy, Inc. (CWEN) are influenced by several factors, including the pace of renewable energy development, regulatory policies, and overall economic conditions. While specific revenue growth projections may vary depending on the source and forecasting model, the general consensus points to continued growth in the renewable energy sector, which should benefit Clearway Energy, Inc. (CWEN).

Strategic initiatives and partnerships play a crucial role in driving future growth for Clearway Energy, Inc. (CWEN). The company actively pursues partnerships with other industry players to develop and operate renewable energy projects. These collaborations enable Clearway Energy, Inc. (CWEN) to leverage the expertise and resources of its partners, accelerate project development, and mitigate risks.

Competitive advantages that position Clearway Energy, Inc. (CWEN) for growth:

• Diversified Asset Portfolio: Clearway Energy, Inc. (CWEN) owns and operates a diversified portfolio of renewable energy assets, including solar, wind, and natural gas power plants.
• Experienced Management Team: Clearway Energy, Inc. (CWEN) has an experienced management team with a proven track record of developing and operating energy infrastructure assets.
• Strong Financial Position: Clearway Energy, Inc. (CWEN) maintains a solid financial position, which provides the company with the flexibility to pursue growth opportunities and weather economic downturns.

Here is a table summarizing some key aspects of Clearway Energy, Inc. (CWEN)'s growth prospects:

For more insights into Clearway Energy, Inc. (CWEN)'s mission, vision, and core values, you can explore: Mission Statement, Vision, & Core Values of Clearway Energy, Inc. (CWEN).