Black Hills (BKH) AI Stock Analysis

• Market Cap: $4.34B
• Dividend Yield: 4.49%
• Average Volume (3M): 733.49K
• Price to Earnings (P/E): 15.0
• Beta (1Y): 0.31
• Revenue Growth: 5.41%
• EPS Growth: -1.89%
• Country: US
• Employees: 2,841
• Sector: Utilities
• Sector Strength: 62
• Industry: Diversified Utilities
• EPS (TTM): 0.38
• Shares Outstanding: 72,856,550
• 10 Day Avg. Volume: 607,545
• 30 Day Avg. Volume: 733,485
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.96
• Enterprise Value/Revenue: 3.79
• Enterprise Value/Gross Profit: 9.78
• Enterprise Value/Ebitda: 10.50
• 1Y Price Target: $65.00
• Price Target Upside: 8.90% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 77 Outperform
• Price Target: $68.00 ▲(13.92% Upside)

Black Hills Corporation scores well due to strong technical momentum and positive corporate events, particularly the merger with NorthWestern Energy. While financial performance is solid, addressing revenue consistency and cash flow volatility could further enhance the company's prospects.

Positive Factors

Financial Stability

The Large Power Contract Service (LPCS) tariff provides predictability and visibility that investors value, without the operating, cash flow, and financing drag associated with traditional contracts.

Growth Prospects

The potential earnings contribution from large projects could significantly alter the company's growth profile, bolstering its long-term prospects.

Merger Benefits

The merger between Black Hills Corp. and NorthWestern Energy is expected to improve the strategic positioning and fundamental outlook of the combined company.

Negative Factors

Earnings Growth Uncertainty

It is incredibly difficult to assess accretion and the earnings profile without knowing details of the ramp, which could end well into the 2030s.

Financial Pressure

A larger capital expenditure program would increase pressure on an already tight balance sheet, potentially impacting financial stability.

Black Hills Business Overview & Revenue Model

Company Description

Black Hills Corporation (BKH) is a diversified energy company based in the United States, primarily engaged in providing electric and natural gas services to residential, commercial, and industrial customers. With operations spanning multiple states, the company operates through two main segments: utility operations, which include electric and gas distribution, and non-regulated operations, which encompass power generation and other energy-related services. BKH is committed to delivering reliable energy solutions while also focusing on renewable energy initiatives.

How the Company Makes Money

Black Hills Corporation generates revenue primarily through its utility operations by charging customers for the electricity and natural gas they consume. The company earns a return on investment through regulated rates set by state utility commissions, which allows them to recover costs and earn a profit margin. Additionally, BKH's non-regulated operations contribute to its revenue through the sale of electricity generated from renewable sources and other energy services. Significant partnerships with local governments and energy organizations further enhance its ability to expand its service offerings and optimize operations, thus contributing to its overall earnings.

Black Hills Financial Statement Overview

Summary

Black Hills demonstrates solid financial performance with strong profitability and stable cash flows. However, challenges with revenue consistency and free cash flow volatility need addressing to enhance financial stability and growth prospects.

Income Statement

Black Hills shows a stable revenue growth with a slight increase in the TTM period. Gross profit and net profit margins are healthy, indicating efficient cost management. However, the revenue growth rate has been inconsistent over the years, which could pose a risk if not addressed.

Balance Sheet

The company maintains a moderate debt-to-equity ratio, which is typical for the utilities industry. Return on equity is stable, reflecting consistent profitability. However, the equity ratio suggests a reliance on debt financing, which could impact financial stability if interest rates rise.

Cash Flow

Operating cash flow remains strong, but free cash flow has been volatile, with significant negative growth in recent periods. The operating cash flow to net income ratio is healthy, but the free cash flow to net income ratio indicates potential cash flow management issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.24B	2.13B	2.33B	2.55B	1.95B	1.70B
Gross Profit	869.50M	840.40M	796.40M	772.80M	705.50M	709.13M
EBITDA	809.90M	785.30M	738.40M	709.50M	648.50M	645.07M
Net Income	284.30M	273.10M	262.20M	258.40M	236.70M	227.61M
Balance Sheet
Total Assets	10.09B	10.02B	9.62B	9.62B	9.13B	8.09B
Cash, Cash Equivalents and Short-Term Investments	8.10M	16.10M	86.60M	21.43M	8.92M	6.36M
Total Debt	4.38B	4.38B	4.40B	4.67B	4.55B	3.77B
Total Liabilities	6.37B	6.44B	6.31B	6.53B	6.24B	5.43B
Stockholders Equity	3.64B	3.50B	3.22B	2.99B	2.79B	2.56B
Cash Flow
Free Cash Flow	269.90M	-24.90M	388.80M	-19.56M	-742.06M	-225.54M
Operating Cash Flow	671.70M	719.30M	944.40M	584.80M	-64.56M	541.86M
Investing Cash Flow	-405.30M	-746.00M	-536.70M	-603.88M	-664.23M	-761.66M
Financing Cash Flow	-458.30M	-42.90M	-341.70M	32.25M	731.87M	216.88M

Black Hills Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 59.69
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKH, the sentiment is Positive. The current price of 59.69 is below the 20-day moving average (MA) of 60.16, above the 50-day MA of 57.99, and above the 200-day MA of 57.96, indicating a neutral trend. The MACD of 0.41 indicates Positive momentum. The RSI at 53.15 is Neutral, neither overbought nor oversold. The STOCH value of 25.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BKH.

Black Hills Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OTTR	79 Outperform	$3.54B	12.32	17.13%	2.42%	-3.69%	-8.25%
BKH	77 Outperform	$4.34B	15.02	8.13%	4.49%	5.41%	-1.89%
NWE	77 Outperform	$3.54B	15.57	7.93%	4.54%	3.78%	7.48%
MGEE	74 Outperform	$3.11B	23.47	10.75%	2.15%	8.47%	12.76%
AVA	72 Outperform	$2.97B	16.33	6.91%	5.28%	2.41%	-9.85%
Sector *	66 Neutral	$17.25B	17.99	5.54%	3.64%	6.63%	11.55%
ALE	62 Neutral	$3.70B	20.12	6.46%	4.54%	-0.44%	-17.46%

Black Hills Corporate Events

Black Hills Announces Merger with NorthWestern Energy Group

On August 18, 2025, Black Hills Corporation entered into a merger agreement with NorthWestern Energy Group, creating a premier regional regulated utility company with a pro forma market capitalization of approximately $7.8 billion. The merger, unanimously approved by both companies’ boards, is expected to enhance operational scale, financial strength, and investment opportunities, supporting a long-term EPS growth rate of 5% to 7%. The combined entity will maintain a strong investment-grade credit profile, continue existing dividend policies, and focus on delivering value to customers and communities through improved operational efficiencies and a commitment to clean energy initiatives.

Black Hills and NorthWestern Energy Announce Merger

On August 19, 2025, Black Hills Corporation and NorthWestern Energy Group announced a merger agreement to create a premier regional regulated utility company. The merger, structured as an all-stock transaction, is expected to enhance the companies’ financial strength and operational scale, providing opportunities for increased investment in energy infrastructure and improved customer service. The combined entity will serve approximately 2.1 million customers across eight states, with a focus on sustainable growth and community support. The merger is anticipated to be accretive to earnings per share in the first year and aims to support a long-term EPS growth rate of 5% to 7%, benefiting shareholders and stakeholders alike.