Earlier in the month, SIA highlighted a compelling option for financial advisors seeking defensive, dividend paying equity positions within today’s volatile market environment when we highlighted Brookfield Renewable Partners L.P. in our Oct 17th edition of the Daily Stock Report. Today we will examine another name also in the Utilities Sector which has traditionally been regarded as a haven for stability and income. Northland Power Inc (NPI.TO) is potentially materializing as a compelling option in this space.
Northland Power resides in the SIA Combined Canadian Divided Report, which is SIA’s most comprehensive dividend report combining the S&P/TSX Canadian Dividend Aristocrats Index, the S&P/TSX High Dividend Index, and the Dow Jones Canada Select Dividend Index report together to give SIA’s subscribers the most in depth choices of dividend names in the Canadian Market. Currently, NPI.TO resides in the Yellow Neutral Zone at the 53rd spot in the report which may indicate this is a name to keep an eye on. It has strengthened from deep in the Red Zone and entered the Neutral zone earlier this year indicating some strength beginning to materialize. The shares have gained 17 spots in the last month and has appreciated 11.96% in the last month and 12.12% in the last quarter. As well, the shares currently offer an enticing 4.75% dividend.
In analyzing the candlestick chart of Northland Power Inc, we see some encouraging signs the shares are beginning to turn itself around. After a massive bear market for all Utility names when the market was experiencing a rising interest rate environment from 2021 to 2023, which was bearish for the utility sector, we now see signs of a reversal occurring. The shares found a bottom in January of this year at the $15 area. Since then, a steady pattern of higher highs and higher lows materialized confirming a new uptrend in place. What is most encouraging is when the shares broke above the $23.00 level late last month this price point had offered rather significant resistance as the shares struggled to break above this price point in January 2024, July 2024 and July of 2025. The next line of resistance is staggered around the $29 to 31 area while support will be found at $23.00.
In looking at the Point and Figure chart on a 2% scale, lets identify more precise support and resistance levels. Herein, we can specifically identify the formidable prior resistance level at the $22.51 to $22.96 area, where the shares decisively broke above most recently. The stock is currently bumping its head at the long-term downtrend line (red), but if the shares manage to close above $25.36 this would indicate another positive move.
Next resistance above its current levels will be at $29.71 where the shares broke below and a massive downtrend materialized in May of 2023. Above this level, we see another resistance point at $31.53. To the downside, support is at its 3 box reversal of $$22.96 and, below that, $20.80. The shares currently exhibit a bullish Double Top Pattern and has a positive SMAX score of 8 out of 10 which indicates rather strong near term strength against the asset classes.
Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.
