Stock Profile: Calpine Corporation Symbol: CPX (TSE), CPN (NYSE)

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Stats as of 4/27/01

• H/L Ratio: 2.76 • RS: 98.7 • Shares: 284,794,073 • P/E: 41.67 • Price: $85.84

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With demand for electricity growing 3% a year in the United States, we have already seen shortfalls in supply, particularly in California. Calpine Corporation is well positioned to grow into this expanding market with its efficient integrated power generation systems.

Founded in 1984 by its visionary leader, Peter Cartwright, the company has grown from a small one megawatt geothermal unit to become the fastest growing independent power company in America. The company is on the cutting edge of electricity generating technology with 50 plants powered by either clean-burning natural gas or by geothermal energy. It is, in fact, the world's largest producer of geothermal energy.

While most old-line power companies operate dirty, inefficient coal plants, Calpine forges ahead with its modern plants. 5900 megawatts of production are on stream now. A further 14,000 megawatts are under construction. And a further 16,200 megawatts are in the development stage.

Vertically integrated, Calpine recently merged with Calgary's Encal Energy, increasing its proved and probable reserves of natural gas to 1.7 trillion cubic feet.

The completion of the merger of Encal saw exchangeable shares of Calpine trading for the first time on the TSE on April 23rd. The shares are exchangeable anytime on a one-for-one basis with Calpine shares on the NYSE. This is a boon for Canadians in a number of ways.

First, Encal shareholders who hang on to their new Calpine shares can do so without violating Canadian content regulations in their RRSPs (though they will be considered foreign content for new purchasers). Secondly, brokerage fees will be less with brokers like E-Trade who charge the same flat fee in the currency of the transaction. You pay in Canadian instead of US dollars. And thirdly, the stock follows the trading of the parent stock on the NYSE, so if the Canadian dollar continues to sink, as many think it will, the value of the exchangeable shares will go up to compensate.

The company is running at a fairly reasonable P/E of 41.67 considering its growth prospects. Disclosure: I bought some for my wife's portfolio on Thursday.

Quarterly Earnings per Share (all figures in $US)

Annual Earnings per Share (all figures in $US)