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1. Company Snapshot

1.a. Company Description

NiSource Inc., an energy holding company, operates as a regulated natural gas and electric utility company in the United States.It operates through two segments, Gas Distribution Operations and Electric Operations.The company distributes natural gas to approximately 853,000 customers in northern Indiana, as well as approximately 2.4 million residential, commercial, and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, and Maryland.


It operates approximately 54,600 miles of distribution main pipelines, as well as associated individual customer service lines; and 1,000 miles of transmission main pipelines.The company generates, transmits, and distributes electricity to approximately 483,000 customers in 20 counties in the northern part of Indiana, as well as engages in wholesale electric and transmission transactions.It owns and operates coal-fired electric generating stations with a capacity of 722 megawatts (MW) in Wheatfield and 455 MW in Michigan City; combined cycle gas turbine with a capacity of 563 MW in West Terre Haute; natural gas generating units with a capacity of 155 MW in Wheatfield; hydro generating plants with a capacity of 9 MW in Carroll County and 7 MW in White County; and wind generating units with a capacity of 102 MW and 302 MW in White County, Indiana.


The company was formerly known as NIPSCO Industries, Inc.and changed its name to NiSource Inc.in April 1999.


NiSource Inc.was founded in 1847 and is headquartered in Merrillville, Indiana.

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1.b. Last Insights on NI

NiSource's recent performance is driven by strong earnings momentum, boosted by increased investments, new rates, and flat operation and maintenance expenses. The company's Q2 2025 earnings beat estimates, with adjusted EPS of $0.22, exceeding analyst expectations. NiSource's growth strategy focuses on clean energy investments, strong regulated assets, and rising dividends. The company received Indiana Utility Regulatory Commission's approval for its GenCo strategy, a significant milestone. With a Zacks Rank #2 (Buy) and steady growth prospects, NiSource's fundamentals remain intact, despite regulatory risks. Its quarterly dividend payment of $0.28 per share also supports shareholder value.

1.c. Company Highlights

2. NiSource's Q3 2025 Earnings: A Strong Performance

NiSource reported third-quarter adjusted EPS of $0.19, slightly below estimates of $0.2, bringing their year-to-date total to $1.38. The company reaffirmed the upper half of their 2025 adjusted EPS guidance of $1.85 to $1.89. Revenue growth is expected to continue, with analysts estimating a 3.8% increase in revenues for the next year. With a current P/E Ratio of 22.2 and an EV/EBITDA of 11.82, the market seems to be pricing in a certain level of growth.

Publication Date: Nov -02

📋 Highlights
  • 8-9% Adjusted EPS CAGR Target:: Introduced an 8% to 9% compound annual growth rate for consolidated adjusted EPS through 2033, driven by $28 billion in capital expenditures.
  • $6B–$7B Data Center Investment:: Secured a contract with a large investment-grade customer, representing $6 billion to $7 billion in capital investment for data center projects.
  • $1.38 Year-to-Date Adjusted EPS:: Reported third-quarter adjusted EPS of $0.19, with a year-to-date total of $1.38, reaffirming upper-half 2025 guidance of $1.85 to $1.89.
  • $28B Total CapEx Plan:: Allocated $28 billion in capital expenditures over five years, including $7 billion for GenCo data center projects and $2 billion for traditional utility operations.
  • $1B Customer Flowback Mechanism:: Contract guarantees over $1 billion in bill savings for existing NIPSCO electric customers over the project term, mitigating cost risks.

Operational Highlights

The company has made significant progress in advancing their data center strategy, securing a contract with a large investment-grade customer representing approximately $6 billion to $7 billion in capital investment. This project is expected to drive growth and enhance shareholder value while maintaining affordability for customers and supporting economic development.

Regulatory Progress

NiSource has made strong progress on their regulatory agenda, advancing tracker programs in Ohio and Indiana, and their Pennsylvania rate case remains on track. The company has also secured approval of the GenCo model in Indiana, reinforcing their constructive regulatory foundation.

Growth Prospects

The company is introducing an 8% to 9% adjusted EPS compound annual growth rate for the consolidated business through 2033, driven by their data center strategy and other growth initiatives. With a robust pipeline of opportunities, NiSource is well-positioned for long-term success in the data center market.

Financial Commitments

NiSource remains committed to 14% to 18% FFO to debt in all years of the plan, and their credit metrics have improved. The company's strong operational cash flow continues to support capital investments, and they expect to achieve results in the upper half of their 2025 adjusted EPS guidance range.

Valuation and Returns

With a ROE of 10.07% and an ROIC of 13.16%, NiSource is generating strong returns on equity and invested capital. The company's dividend yield of 2.66% provides a relatively stable source of return for investors. The current valuation metrics, including a P/B Ratio of 2.18, suggest that the market is pricing in a certain level of growth and profitability.

3. NewsRoom

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Boston Partners Increases Stake in NiSource, Inc $NI

Nov -29

Source: defenseworld.net

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Here's Why NI Stock Deserves a Spot in Your Portfolio Right Now

Nov -27

Source: zacks.com

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Cetera Investment Advisers Has $3.90 Million Position in NiSource, Inc $NI

Nov -26

Source: defenseworld.net

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NiSource, Inc $NI Holdings Decreased by Oppenheimer Asset Management Inc.

Nov -02

Source: defenseworld.net

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NiSource Announces $1.5 Billion At-The-Market (ATM) Equity Issuance Program Through 2028

Oct -31

Source: businesswire.com

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Zachry Group Awarded Engineering, Procurement, and Construction (EPC) Contract for NiSource's Combined Cycle Generation Project

Oct -30

Source: businesswire.com

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Ethic Inc. Has $340,000 Stock Holdings in NiSource, Inc $NI

Oct -30

Source: defenseworld.net

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NiSource Inc. (NI) Q3 2025 Earnings Call Transcript

Oct -30

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.73%)

6. Segments

Gas Distribution

Expected Growth: 6.5%

NiSource Inc.'s Gas Distribution segment growth of 6.5% is driven by increasing demand for natural gas, infrastructure investments, and rate base growth. Additionally, favorable weather conditions, customer additions, and cost savings initiatives contribute to the segment's growth.

Electric

Expected Growth: 7.2%

NiSource Inc.'s 7.2% growth in Electric segment is driven by increasing demand for clean energy, investments in grid modernization, and favorable regulatory policies. Additionally, the company's focus on renewable energy sources, such as wind and solar, contributes to the growth. Furthermore, NiSource's efforts to improve operational efficiency and reduce costs also support the segment's expansion.

Corporate and Other

Expected Growth: 6.8%

NiSource Inc.'s Corporate and Other segment growth of 6.8% is driven by increased investments in infrastructure, cost savings initiatives, and favorable regulatory outcomes. Additionally, the company's focus on operational efficiency and effective cost management have contributed to the segment's growth.

7. Detailed Products

Natural Gas Distribution

NiSource Inc. provides natural gas distribution services to residential, commercial, and industrial customers through its subsidiaries.

Electricity Generation

NiSource Inc. generates electricity through its power plants, providing wholesale electricity to the market.

Transmission and Storage

NiSource Inc. owns and operates natural gas transmission and storage facilities, providing transportation and storage services to customers.

Midstream Services

NiSource Inc. provides midstream services, including gathering, processing, and transporting natural gas and natural gas liquids.

Electricity Transmission

NiSource Inc. owns and operates electricity transmission lines, providing transmission services to customers.

8. NiSource Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

NiSource Inc. operates in a highly regulated industry, which limits the threat of substitutes. However, the increasing adoption of renewable energy sources and energy-efficient technologies poses a moderate threat to the company's traditional business model.

Bargaining Power Of Customers

NiSource Inc. serves a large customer base, which reduces the bargaining power of individual customers. Additionally, the company's diversified customer mix and long-term contracts further mitigate the bargaining power of customers.

Bargaining Power Of Suppliers

NiSource Inc. relies on a few large suppliers for its natural gas and energy infrastructure needs. While the company has some bargaining power due to its scale, suppliers may still exert some pressure on prices and terms.

Threat Of New Entrants

The energy industry is highly regulated, and significant barriers to entry exist, including high capital requirements and complex infrastructure needs. This limits the threat of new entrants to NiSource Inc.'s business.

Intensity Of Rivalry

NiSource Inc. operates in a highly competitive industry, with several large players vying for market share. The company faces intense competition in terms of pricing, customer service, and innovation, which may impact its market position and profitability.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 63.08%
Debt Cost 4.28%
Equity Weight 36.92%
Equity Cost 6.34%
WACC 5.04%
Leverage 170.84%

11. Quality Control: NiSource 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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New Jersey Resources

A-Score: 6.7/10

Value: 6.7

Growth: 4.3

Quality: 5.3

Yield: 8.0

Momentum: 6.0

Volatility: 10.0

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ONE Gas

A-Score: 6.3/10

Value: 5.9

Growth: 4.4

Quality: 4.7

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

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NiSource

A-Score: 6.3/10

Value: 5.0

Growth: 3.3

Quality: 4.7

Yield: 6.0

Momentum: 8.5

Volatility: 10.0

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Atmos Energy

A-Score: 6.1/10

Value: 4.3

Growth: 4.9

Quality: 5.4

Yield: 4.0

Momentum: 8.0

Volatility: 10.0

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Southwest Gas Holdings

A-Score: 5.9/10

Value: 4.2

Growth: 5.2

Quality: 3.5

Yield: 7.0

Momentum: 6.0

Volatility: 9.7

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New Fortress Energy

A-Score: 3.7/10

Value: 9.8

Growth: 6.4

Quality: 2.5

Yield: 3.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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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

42.0$

Current Price

42$

Potential

-0.00%

Expected Cash-Flows