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1. Company Snapshot

1.a. Company Description

MDU Resources Group, Inc.engages in the regulated energy delivery, and construction materials and services businesses in the United States.The company's Electric segment generates, transmits, and distributes electricity for residential, commercial, industrial, and municipal customers in Montana, North Dakota, South Dakota, and Wyoming, as well as operates 3,500 miles of transmission lines and 4,800 miles of distribution lines.


Its Natural Gas Distribution segment distributes natural gas for residential, commercial, and industrial customers in Idaho, Minnesota, Montana, North Dakota, Oregon, South Dakota, Washington, and Wyoming; and offers supply-related value-added services.The company's Pipeline segment provides natural gas transportation and underground storage services through a regulated pipeline system primarily in the Rocky Mountain and northern Great Plains regions; and cathodic protection and other energy-related services.Its Construction Materials and Contracting segment mines, processes, and sells construction aggregates; produces and sells asphalt mix; and supplies ready-mixed concrete.


This segment is also involved in the sale of cement, finished concrete products, and other building materials and related contracting services.The company's Construction Services segment designs, constructs, and maintains electrical and communication wiring and infrastructure, fire suppression systems, mechanical piping and services; overhead and underground electrical, gas, and communication infrastructure; and manufactures and distributes transmission lines construction equipment.It serves manufacturing, commercial, industrial, transportation, institutional, and renewable and government customers, as well as utilities.


The company was founded in 1924 and is headquartered in Bismarck, North Dakota.

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1.b. Last Insights on MDU

MDU Resources Group, Inc.'s recent performance was negatively impacted by its Q2 earnings lag, with profit plunging despite a revenue uptick. The company's narrowed full-year EPS guidance to $0.88-$0.95 per share also raised concerns. Although the pipeline segment showed solid performance, driven by higher transportation revenue, and the electric utility and natural gas distribution customer base achieved a 1.4% year-over-year growth rate, these positives were overshadowed by the earnings miss. The company's refocus on its core utility business post-spin-off of Everus Construction Group may be a strategic move.

1.c. Company Highlights

2. MDU Resources Beats Q3 Earnings Expectations

MDU Resources Group, Inc. reported income from continuing operations of $18.4 million or $0.09 per share for the third quarter of 2025, beating analyst estimates of $0.07 per share. The company's revenues were driven by strong performance at its Pipeline segment, which posted record third-quarter earnings of $16.8 million, up from $15.1 million in the same period last year. The Electric Utility reported third-quarter earnings of $21.5 million, while the Natural Gas utility reported a seasonal loss of $18.2 million. The company's EPS growth was driven by higher transportation revenue from growth projects placed in service in late 2024 and customer demand for short-term firm natural gas transportation contracts.

Publication Date: Nov -15

📋 Highlights
  • Quarterly Earnings Growth:: Q3 2025 income from continuing operations rose to $18.4M ($0.09/share) vs. $15.6M ($0.08/share) in Q3 2024.
  • Utility Customer Growth:: Combined retail customer growth reached 1.5% YoY, within the 1–2% annual target range.
  • Badger Wind Farm Acquisition:: Approved 49% ownership stake (122.5MW) in the 250MW project, allocated to the 2026 capital budget.
  • Data Center Load Capacity:: 580MW of signed electric service agreements, with an additional 100MW set to ramp in late 2025–2026.
  • Pipeline Expansion Impact:: Minot project added 7MMcf/d capacity; Line Section 32 expansion progresses for Northwest North Dakota generation support.

Segment Performance

The Pipeline segment's strong performance was driven by the Minot expansion project, which was placed in service earlier in the quarter and added approximately 7 million cubic feet of natural gas transportation capacity per day. The Electric Utility's earnings were impacted by higher operation and maintenance expense, primarily from higher payroll-related costs and higher contract services related to electric generation station outages. As Nicole Kivisto, President and CEO, noted, "Strong performance at our Pipeline segment drove results for the quarter."

Growth Prospects

MDU Resources is confident in its ability to execute on its long-term growth strategy, with a target EPS growth rate of 6% to 8% and a dividend payout ratio of 60% to 70%. The company has 580 megawatts of data center load under signed electric service agreements, with an additional 100 megawatts expected to start ramping online late this year and continue into 2026. Analysts estimate next year's revenue growth at 4.6%.

Valuation

MDU Resources trades at a P/E Ratio of 24.87 and a P/B Ratio of 1.55, indicating a relatively high valuation compared to its earnings and book value. However, the company's Dividend Yield is 2.57%, which may be attractive to income investors. The EV/EBITDA ratio is 12.58, indicating a moderate valuation relative to its earnings before interest, taxes, depreciation, and amortization. With an ROE of 6.22% and an ROIC of 3.79%, the company's profitability metrics are relatively stable.

3. NewsRoom

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MDU Resources Prices Public Offering of 10,152,284 Shares of Common Stock with a Forward Component

Dec -04

Source: prnewswire.com

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MDU Resources Announces Public Offering of $200 Million of Shares of Common Stock with a Forward Component

Dec -03

Source: prnewswire.com

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American Century Companies Inc. Has $42.77 Million Stake in MDU Resources Group, Inc. $MDU

Nov -29

Source: defenseworld.net

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Northwest Natural Gas (NYSE:NWN) and MDU Resources Group (NYSE:MDU) Head to Head Contrast

Nov -25

Source: defenseworld.net

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MDU Resources Group, Inc. $MDU Shares Bought by Commonwealth of Pennsylvania Public School Empls Retrmt SYS

Nov -24

Source: defenseworld.net

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MDU Resources Group Announces Increased Capital Investment Plan for 2026-2030

Nov -20

Source: prnewswire.com

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SWX or MDU: Which Is the Better Value Stock Right Now?

Nov -18

Source: zacks.com

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MDU Resources Group, Inc. $MDU Position Increased by Bailard Inc.

Nov -15

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.91%)

6. Segments

Construction Services

Expected Growth: 3.5%

MDU Resources Group's Construction Services segment growth of 3.5% is driven by increasing demand for infrastructure development, government investments in transportation and energy projects, and a strong backlog of projects. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth.

Natural Gas Distribution

Expected Growth: 1.8%

MDU Resources Group's Natural Gas Distribution segment growth of 1.8% is driven by increasing customer base, favorable weather conditions, and infrastructure investments. Additionally, rate base growth, expansion of service territories, and cost savings initiatives contribute to the segment's growth.

Electric

Expected Growth: 2.5%

MDU Resources Group's Electric segment growth of 2.5% is driven by increasing demand for electricity in its service territories, investments in grid modernization and infrastructure upgrades, and a focus on renewable energy sources. Additionally, the company's efforts to improve operational efficiency and customer growth also contribute to this growth rate.

Pipeline

Expected Growth: 2.2%

MDU Resources Group's pipeline growth is driven by increasing demand for natural gas infrastructure, strategic acquisitions, and expansion into high-growth regions. Additionally, the company's focus on safety, reliability, and customer satisfaction has led to increased customer loyalty and retention, further contributing to its 2.2% growth.

7. Detailed Products

Construction Services

MDU Resources Group, Inc. provides construction services through its subsidiary, MDU Construction Services Group, Inc. The company offers a range of services including electrical, mechanical, and civil construction, as well as transmission and distribution services.

Energy Transportation and Storage

The company's energy transportation and storage segment provides natural gas transportation, storage, and gathering services through its subsidiary, WBI Energy, Inc.

Electric and Gas Distribution

MDU Resources Group, Inc. provides electric and gas distribution services through its subsidiary, Montana-Dakota Utilities Co. The company distributes electricity and natural gas to residential, commercial, and industrial customers.

Pipeline and Midstream

The company's pipeline and midstream segment provides oil and natural gas gathering, processing, and transportation services through its subsidiary, WBI Energy, Inc.

Refining and Marketing

MDU Resources Group, Inc. provides refining and marketing services through its subsidiary, Dakota Prairie Refining, LLC. The company refines crude oil into various petroleum products.

8. MDU Resources Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

MDU Resources Group, Inc. operates in the energy and construction materials industries, which have relatively low substitutability. While there are some substitutes for energy and construction materials, they are not easily replaceable, and the company's products and services have a moderate level of uniqueness.

Bargaining Power Of Customers

MDU Resources Group, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products and services are often essential to its customers, giving it an upper hand in negotiations.

Bargaining Power Of Suppliers

MDU Resources Group, Inc. has a moderate level of dependence on its suppliers, particularly for raw materials and equipment. While the company has some bargaining power due to its size and scale, suppliers also have some leverage due to the specialized nature of their products.

Threat Of New Entrants

The energy and construction materials industries have high barriers to entry, including significant capital requirements, regulatory hurdles, and the need for specialized expertise. This makes it difficult for new entrants to enter the market and compete with established players like MDU Resources Group, Inc.

Intensity Of Rivalry

The energy and construction materials industries are highly competitive, with many established players competing for market share. MDU Resources Group, Inc. faces intense competition from rivals, which can lead to pricing pressure and reduced profit margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 46.96%
Debt Cost 5.37%
Equity Weight 53.04%
Equity Cost 7.38%
WACC 6.44%
Leverage 88.54%

11. Quality Control: MDU Resources Group, Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

19.26$

Current Price

19.27$

Potential

-0.00%

Expected Cash-Flows