National Grid (GB:NG)
LSE:NG
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National Grid
(LSE:NG)
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Rating:56Neutral
Price Target:
1,245.00 p
▼(-2.34% Downside)
Action:Reiterated
Date:06/14/26
The score is driven primarily by moderate financial strength with a key risk: negative free cash flow alongside elevated leverage, despite steady operating cash generation. Technical indicators point to weak momentum below key moving averages, while valuation is somewhat supported by the ~4% dividend yield and a mid-range P/E.
Positive Factors
Regulated revenue model
National Grid’s core earnings derive from multi-year regulatory frameworks and allowed returns tied to its regulated asset base. That structure provides durable, contract-like cash flow visibility, aligns returns with capex, and makes growth largely a function of approved investment programs rather than commodity cycles.
Negative Factors
Persistently negative free cash flow
Sustained negative free cash flow signals that investment and capex outstrips internally generated cash, forcing reliance on external financing. Over months, this raises the risk of higher funding costs, equity issuance or incremental debt, which can pressure credit metrics and limit capital allocation flexibility.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulated revenue model
National Grid’s core earnings derive from multi-year regulatory frameworks and allowed returns tied to its regulated asset base. That structure provides durable, contract-like cash flow visibility, aligns returns with capex, and makes growth largely a function of approved investment programs rather than commodity cycles.
Read all positive factors
National Grid (NG) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£59.24B
Dividend Yield4.15%
Average Volume (3M)9.07M
Price to Earnings (P/E)18.3
Beta (1Y)0.77
Revenue Growth-3.76%
EPS Growth8.20%
CountryUK
Employees31,425
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)0.66
Shares Outstanding4,975,710,400
10 Day Avg. Volume10,299,451
30 Day Avg. Volume9,074,946
Financial Highlights & Ratios
PEG Ratio1.92
Price to Book (P/B)1.60
Price to Sales (P/S)3.55
P/FCF Ratio-16.72
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£1,373.33Price Target Upside7.73% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
EPS Forecast (FY)0.89
Revenue Forecast (FY)£19.91B
National Grid Business Overview & Revenue Model
Company Description
National Grid plc operates as a major energy utility, focusing on the transmission and distribution of both electricity and natural gas. Its business is organized into distinct geographical and operational segments. Within the United Kingdom, it o...
How the Company Makes Money
National Grid primarily makes money by owning and operating regulated energy networks and earning allowed revenues set by regulators rather than by selling electricity or gas as a commodity. In the UK, its revenues are largely determined under mul...
National Grid Earnings Call Summary
Earnings Call Date:Nov 06, 2025
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with strong financial performance, significant investment commitments, and regulatory support. However, challenges in energy affordability and inflationary pressures remain. Ongoing regulatory discussions add an element of uncertainty.Positive Updates
Strong Financial Performance
Underlying operating profit increased by 13% to GBP 2.3 billion, with underlying earnings per share up 6% to 29.8p. Capital investment reached a record GBP 5.1 billion, up 12% year-on-year.
Negative Updates
Challenges in Energy Affordability
Ongoing concerns about energy affordability, particularly in the U.S., with political pressure around pricing.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Financial Performance
Underlying operating profit increased by 13% to GBP 2.3 billion, with underlying earnings per share up 6% to 29.8p. Capital investment reached a record GBP 5.1 billion, up 12% year-on-year.
Read all positive updates
Company Guidance
In the recent National Grid call, several key metrics and guidance points were highlighted for the fiscal year 2026. The company plans to invest £60 billion in capital investments to future-proof networks, anticipating an investment growth of around 10% per annum. This investment is expected to drive underlying earnings per share growth of 6% to 8%, while maintaining a strong balance sheet and delivering an inflation-protected dividend. In the first half of the fiscal year, National Grid achieved a record capital investment of over £5 billion and is on track to exceed £11 billion in capital investment for the year. Underlying operating profit rose by 13% to £2.3 billion, with underlying earnings per share increasing by 6% to 29.8p. The company also declared an interim dividend of 16.35p per share. National Grid's focus remains on securing supply chains, regulatory approvals, and policy developments to support their strategic investment projects, particularly in the U.K. and U.S. markets.National Grid Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
60
Neutral
Cash Flow
45
Neutral
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.69B | 18.38B | 19.85B | 21.66B | 18.45B |
| Gross Profit | 5.78B | 18.38B | 19.85B | 21.66B | 18.45B |
| EBITDA | 7.73B | 6.79B | 7.28B | 5.84B | 6.04B |
| Net Income | 3.24B | 2.90B | 2.29B | 7.80B | 2.35B |
Balance Sheet | |||||
| Total Assets | 108.28B | 106.74B | 98.33B | 92.70B | 94.86B |
| Cash, Cash Equivalents and Short-Term Investments | 2.83B | 6.93B | 4.25B | 2.77B | 3.35B |
| Total Debt | 46.76B | 48.36B | 47.07B | 42.98B | 45.47B |
| Total Liabilities | 68.95B | 68.92B | 68.43B | 63.13B | 71.00B |
| Stockholders Equity | 39.30B | 37.80B | 29.87B | 29.54B | 23.83B |
Cash Flow | |||||
| Free Cash Flow | -3.76B | -2.50B | -514.00M | 6.00M | 728.00M |
| Operating Cash Flow | 6.23B | 6.81B | 6.94B | 6.90B | 6.27B |
| Investing Cash Flow | -4.49B | -10.57B | -7.50B | 240.00M | -14.01B |
| Financing Cash Flow | -2.69B | 4.53B | 987.00M | -7.17B | 7.77B |
National Grid Technical Analysis
Neutral
1274.80
Price Trends
1235.60
Negative
1257.53
Negative
1172.76
Positive
Market Momentum
-7.33
Negative
48.59
Neutral
55.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:NG, the sentiment is Neutral. The current price of 1274.8 is above the 20-day moving average (MA) of 1211.13, above the 50-day MA of 1235.60, and above the 200-day MA of 1172.76, indicating a neutral trend. The MACD of -7.33 indicates Negative momentum. The RSI at 48.59 is Neutral, neither overbought nor oversold. The STOCH value of 55.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:NG.
National Grid Risk Analysis
National Grid disclosed 9 risk factors in its most recent earnings report. National Grid reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
National Grid Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
59 Neutral | £27.87B | 23.07 | 9.45% | 2.98% | 0.54% | -2.65% | |
59 Neutral | £7.85B | 37.36 | 1.68% | 2.86% | -2.11% | -104.48% | |
58 Neutral | £9.69B | 15.16 | 27.72% | 4.45% | 21.96% | 121.69% | |
56 Neutral | £59.24B | 18.27 | 8.47% | 4.15% | -3.76% | 8.20% | |
55 Neutral | £8.73B | 23.49 | 20.35% | 4.50% | 16.66% | 61.25% |
* Utilities Sector Average
GB:NG
National Grid
1,212.00
177.10
17.11%
GB:CNA
Centrica
172.65
9.23
5.65%
GB:SVT
Severn Trent
2,842.00
217.70
8.30%
GB:SSE
SSE
2,325.00
549.47
30.95%
GB:NTEA
Northern Electric
124.50
-1.94
-1.53%
GB:UU
United Utilities
1,289.00
164.47
14.63%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.