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Industrikraft in Sweden AB was formed in June 2024 to support the expansion of the Swedish electricity supply. Industrikraft is now entering the next phase of nuclear power investment with the following companies – ABB, Alfa Laval, Boliden, Hitachi Energy, Höganäs AB, SSAB, Saab, Stora Enso, and the Volvo Group.

Vattenfall and Industrikraft have now signed an agreement that allows the parties to progress in enabling new nuclear power on the Värö Peninsula at Ringhals. The agreement covers various areas such as responsibilities, influence, and financing.

The next step in the collaboration is for Industrikraft to become a 20 percent shareholder in Videberg Kraft AB. The government has previously announced that the state also intends to become a shareholder in the company.

“Industrikraft and Vattenfall have reached consensus on the most important issues”, says Tom Erixon, chairman of Industrikraft and CEO of Alfa Laval. In a first step, Industrikraft will invest SEK 400 million in the project. In addition to co-financing the project company, the industry contributes with resources, expertise in project management and selection of technologies. Swedish technology has a place in a competitive environment to drive the development of a strong supplier cluster in Europe.

“It is very positivenews that Vattenfall and Industrikraft are now taking the next step to move the project forward together. The industry is an important partner in enabling new nuclear power in Sweden. The commitment and willingness of these companies to co-own the project on the Värö Peninsula is a sign that there will be a demand for the new fossil-free electricity production capacity. In the next step, Videberg Kraft AB is working to prepare an application for state risk-sharing”, says Anna Borg, CEO of Vattenfall.

The board of Pine Cliff Energy Ltd. (TSE:PNE) has announced that it will pay a dividend on the 28th of November, with investors receiving CA$0.0013 per share. Including this payment, the dividend yield on the stock will be 1.8%, which is a modest boost for shareholders’ returns.

While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that Pine Cliff Energy’s stock price has increased by 35% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield.

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Even a low dividend yield can be attractive if it is sustained for years on end. Pine Cliff Energy is not generating a profit, but its free cash flows easily cover the dividend, leaving plenty for reinvestment in the business. We generally think that cash flow is more important than accounting measures of profit, so we are fairly comfortable with the dividend at this level.

Over the next year, EPS might fall by 9.6% based on recent performance. This means that the company won’t turn a profit over the next year, but with healthy cash flows at the moment the dividend could still be okay to continue.

Check out our latest analysis for Pine Cliff Energy

Looking back, the dividend has been unstable but with a relatively short history, we think it may be a bit early to draw conclusions about long term dividend sustainability. The annual payment during the last 4 years was CA$0.0996 in 2021, and the most recent fiscal year payment was CA$0.015. The dividend has fallen 85% over that period. Declining dividends isn’t generally what we look for as they can indicate that the company is running into some challenges.

Dividends have been going in the wrong direction, so we definitely want to see a different trend in the earnings per share. It’s not great to see that Pine Cliff Energy’s earnings per share has fallen at approximately 9.6% per year over the past five years. Declining earnings will inevitably lead to the company paying a lower dividend in line with lower profits.

Overall, we don’t think this company makes a great dividend stock, even though the dividend wasn’t cut this year. In the past, the payments have been unstable, but over the short term the dividend could be reliable, with the company generating enough cash to cover it. This company is not in the top tier of income providing stocks.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we’ve identified 2 warning signs for Pine Cliff Energy (1 is a bit concerning!) that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.