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Nisource (NI)
:NI
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Nisource
(NYSE:NI)71Outperform
Positive Factors
Financial Performance
NI delivered another better-than-expected quarter and raised its 2025 full-year guidance.
Investment Opportunities
The company's capital plan update highlighted an additional $2.2bn of upside opportunities to the base plan, with the incremental investment expected to be funded with minimal additional equity.
Negative Factors
Market Valuation
Despite shares trading at a premium, NI is well positioned to take advantage of data center and economic development opportunities due to constructive regulatory treatment and manageable financing needs.
Nisource (NI) vs. S&P 500 (SPY)
Market Cap
$18.69B
Dividend Yield2.61%
Average Volume (3M)4.39M
Price to Earnings (P/E)24.6
Beta (1Y)0.40
Revenue Growth-0.91%
EPS Growth2.11%
CountryUS
Employees7,746
SectorUtilities
Sector Strength79
IndustryRegulated Utilities
Share Statistics
EPS (TTM)1.62
Shares Outstanding469,939,640
10 Day Avg. Volume4,708,592
30 Day Avg. Volume4,389,850
Financial Highlights & Ratios
PEG Ratio11.66
Price to Book (P/B)N/A
Price to Sales (P/S)3.58
Price to Cash Flow (P/CF)9.00
P/FCF Ratio8.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$42.29Price Target Upside6.34% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Nisource Business Overview & Revenue Model
Company DescriptionNiSource, Inc. is a holding company, which engages in energy solutions. Through its subsidiaries, it provides natural gas, electricity, and other products and services. It operates through the following segments: Gas Distribution Operations and Electric Operations. The Gas Distribution Operations segment focuses in the natural gas service and transportation for residential, commercial, and industrial customers. The Electric Operations segment generates, transmits, and distributes electricity. The company was founded in 1987 and is headquartered in Merrillville, IN.
How the Company Makes MoneyNiSource makes money through the regulated distribution and transmission of natural gas and electricity. Its revenue model is based on providing utility services to its customer base, which includes residential, commercial, and industrial sectors. The company earns income through rate-regulated tariffs set by state public utility commissions, which ensure recovery of costs and an allowed rate of return on investments. Key revenue streams include natural gas distribution operations across several states and electric utility services in northern Indiana. NiSource also invests in infrastructure projects, such as pipeline and grid modernization, which are factored into the rate base and contribute to future earnings. Additionally, the company benefits from regulatory mechanisms that support revenue stability and growth, such as decoupling and rate adjustment mechanisms.
Nisource Financial Statement Overview
Summary
Nisource shows a stable financial standing with strong income margins and improved leverage, though concerns remain over negative free cash flow and a decrease in reported total assets.Income Statement
Nisource has demonstrated a stable income profile with improving net profit margins from 6.9% in 2019 to 13.9% in 2024. Despite a slight decline in revenue over the past year, the company has maintained a consistent gross profit margin around 70% over the years. This indicates a strong ability to manage costs effectively. The EBIT and EBITDA margins are also robust, signifying operational efficiency.75
Positive
Balance Sheet
The balance sheet shows moderate leverage with a debt-to-equity ratio of 0.33 in 2024, a significant improvement from previous years. The equity ratio has strengthened over time, reaching 89% in 2024, indicating a solid capital structure. However, the total assets have decreased significantly in 2024 due to changes in reporting, which could be a cause for concern if not clarified.68
Positive
Cash Flow
Cash flow analysis reveals some challenges, particularly with free cash flow, which has fluctuated negatively over the years. Although operating cash flow has shown stability, the free cash flow remains negative, highlighting the need for better capital expenditure management. The operating cash flow to net income ratio was unavailable for 2024, limiting complete cash flow assessment.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 5.46B | 5.51B | 5.85B | 4.90B | 4.68B | Gross Profit |
| 2.81B | 2.49B | 2.25B | 2.05B | 1.99B | EBIT |
| 1.46B | 1.30B | 1.27B | 1.01B | 976.30M | EBITDA |
| 2.57B | 2.21B | 2.14B | 1.80B | 1.07B | Net Income Common Stockholders |
| 760.40M | 714.30M | 804.10M | 584.90M | -14.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 156.60M | 2.25B | 40.80M | 84.20M | 116.50M | Total Assets |
| 31.79B | 31.08B | 26.74B | 24.16B | 22.04B | Total Debt |
| 40.40M | 14.13B | 11.66B | 9.80B | 9.75B | Net Debt |
| 40.40M | 11.88B | 11.62B | 9.72B | 9.63B | Total Liabilities |
| 21.12B | 20.94B | 18.83B | 16.88B | 16.20B | Stockholders Equity |
| 1.24B | 8.27B | 7.58B | 6.95B | 5.75B |
| Cash Flow | Free Cash Flow | |||
| -861.50M | -710.70M | -793.70M | -620.10M | -654.10M | Operating Cash Flow |
| 1.78B | 1.94B | 1.41B | 1.22B | 1.10B | Investing Cash Flow |
| -3.21B | -3.57B | -2.57B | -2.20B | -879.10M | Financing Cash Flow |
| -651.00M | 3.84B | 1.14B | 956.30M | -247.70M |
Nisource Technical Analysis
Positive
39.77
Price Trends
37.68
Positive
36.63
Positive
33.52
Positive
Market Momentum
0.83
Negative
56.78
Neutral
66.94
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NI, the sentiment is Positive. The current price of 39.77 is above the 20-day moving average (MA) of 39.40, above the 50-day MA of 37.68, and above the 200-day MA of 33.52, indicating a bullish trend. The MACD of 0.83 indicates Negative momentum. The RSI at 56.78 is Neutral, neither overbought nor oversold. The STOCH value of 66.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NI.
Nisource Risk Analysis
Nisource disclosed 41 risk factors in its most recent earnings report. Nisource reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nisource Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $21.77B | 21.89 | 8.80% | 2.82% | 0.71% | 11.07% | |
77 Outperform | $99.64B | 22.75 | 13.25% | 3.17% | 5.83% | 10.23% | |
77 Outperform | $27.34B | 19.49 | 12.00% | 3.07% | -1.13% | 0.16% | |
74 Outperform | $33.52B | 21.86 | 12.30% | 3.13% | -3.30% | 14.40% | |
73 Outperform | $56.12B | 18.85 | 73.81% | 3.36% | 2.76% | 31.53% | |
71 Outperform | $18.69B | 24.57 | 61.50% | 2.61% | -0.91% | 2.11% | |
65 Neutral | $12.05B | 15.92 | 6.71% | 4.32% | 8.04% | 3.76% |
* Utilities Sector Average
Performance Comparison
NI
Nisource
39.77
13.78
53.02%
AEP
American Electric Power
105.24
24.43
30.23%
CMS
CMS Energy
72.87
14.43
24.69%
DTE
DTE Energy
131.94
24.10
22.35%
SO
Southern Co
89.89
23.61
35.62%
WEC
WEC Energy Group
105.50
27.19
34.72%
Nisource Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: 3.49% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call highlighted NiSource Inc.'s strong financial performance and growth prospects, supported by significant capital investments and customer satisfaction achievements. However, challenges such as a decrease in fourth quarter EPS and pending regulatory approvals present potential hurdles. Overall, the positive aspects of increased earnings, capital growth, and regulatory success outweigh the challenges.Highlights
Exceeding Earnings Expectations
NiSource Inc. reported an adjusted EPS of $1.75 for 2024, surpassing the top end of both original and updated guidance ranges, marking a 9.4% increase from 2023.
Strong Capital Investment and Growth
The company invested $6.9 billion in capital expenditures over the past 24 months, with plans to increase the base capital plan to $19.4 billion for 2025-2029, expected to drive 8% to 10% rate base growth.
Regulatory and Operational Success
NiSource Inc. achieved regulatory approvals for $340 million in revenue recovery and maintained a constructive regulatory environment.
Customer Satisfaction and Sustainability Recognition
NIPSCO Electric and Columbia Gas of Virginia were recognized as number one in regional customer service satisfaction, and NiSource Inc. was named to the 2024 Dow Jones Sustainability Indices for the eleventh consecutive year.
Lowlights
Decrease in Fourth Quarter EPS
Adjusted EPS for the fourth quarter was $0.49, a decrease of $0.04 per share compared to the previous year, driven by non-controlling interest and increased depreciation.
Pending Regulatory Approvals
The declination filing to establish NIPSCO Genco as a regulated entity is pending approval, which is crucial for future large load customer projects.
Company Guidance
During the Q4 2024 earnings call, NiSource Inc. provided extensive guidance on its financial and operational outlook. The company reported an adjusted EPS of $1.75 for 2024, marking a 9.4% increase from the previous year, and exceeded its guidance range. The 2025 adjusted EPS guidance has been raised to $1.85-$1.89, reflecting a 6% to 8% projected annual growth. NiSource committed to a 5-year capital plan of $19.4 billion, supporting 8% to 10% rate base growth and a 6% to 8% annual EPS growth. Over the past two years, the company has invested $6.9 billion in capital expenditures, with regulatory processes approving $340 million in revenue recovery for 2024. Their Apollo Continuous Improvement Program achieved $77 million in O&M savings, and key safety metrics improved with an 8% reduction in OSHA recordable incidents. NiSource continues to explore opportunities, including $2.2 billion in potential upside CapEx, and the development of data center solutions in Northern Indiana, guided by principles to protect existing customers and maintain financial integrity.Nisource Corporate Events
Executive/Board Changes
NiSource Grants $2M Equity Award to Executive
Neutral
Jan 24, 2025
On January 22, 2025, NiSource Inc.’s Board of Directors’ Compensation and Human Capital Committee awarded Michael Luhrs, the Executive Vice President, Strategy Risk and Chief Commercial Officer, a one-time equity award valued at $2 million. This award consists of 52,938 restricted stock units set to vest in stages over the upcoming years, specifically 33% each on January 22 of 2026 and 2027, and the remaining 34% on January 22, 2028, with additional provisions for vesting upon certain service separations.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.