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National Grid Transco
(NYSE:NGG)
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Rating:61Neutral
Price Target:
$85.00
▲(12.57% Upside)
Action:Reiterated
Date:06/23/26
NGG scores as a moderate opportunity: strong multi-year regulated growth guidance and dividend progression support the outlook, but the financial profile is held back by structurally negative free cash flow and meaningful leverage. Near-term technicals also lean weak, while valuation is reasonable with a ~4% yield.
Positive Factors
Large regulated CapEx & RAV growth
A committed GBP 70bn five‑year investment program driving ~10% annual asset growth materially expands the regulated asset base. Over 2–6 months this durable RAV growth should underpin higher allowed revenues and multi‑year earnings visibility tied to regulated returns.
Negative Factors
Persistent negative free cash flow
Sustained negative free cash flow across multiple years means core investments and dividends are not fully self‑funded. Over the multi‑year plan this creates structural reliance on external financing, raising refinancing, interest and dilution risks and constraining balance sheet flexibility.
Read all positive and negative factors
Positive Factors
Negative Factors
Large regulated CapEx & RAV growth
A committed GBP 70bn five‑year investment program driving ~10% annual asset growth materially expands the regulated asset base. Over 2–6 months this durable RAV growth should underpin higher allowed revenues and multi‑year earnings visibility tied to regulated returns.
Read all positive factors
National Grid Transco Key Performance Indicators (KPIs)
Any
Third Party Revenue by Segment
Tracks revenue generated from external customers in each segment, indicating the company's reliance on third-party sales and potential market demand.
Tracks revenue generated from external customers in each segment, indicating the company's reliance on third-party sales and potential market demand.
Data provided by:
The Fly
The FlyNational Grid Transco (NGG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$83.40B
Dividend Yield4.03%
Average Volume (3M)1.13M
Price to Earnings (P/E)18.6
Beta (1Y)0.11
Revenue Growth1.13%
EPS Growth13.83%
CountryUS
Employees31,619
SectorUtilities
Sector Strength65
IndustryRegulated Electric
Share Statistics
EPS (TTM)3.32
Shares Outstanding995,175,600
10 Day Avg. Volume966,455
30 Day Avg. Volume1,134,341
Financial Highlights & Ratios
PEG Ratio1.87
Price to Book (P/B)1.61
Price to Sales (P/S)3.52
P/FCF Ratio-16.58
Enterprise Value/Market Cap1.28
Enterprise Value/Revenue5.99
Enterprise Value/Gross Profit18.37
Enterprise Value/Ebitda13.78
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)6.02
Revenue Forecast (FY)$26.45B
National Grid Transco Business Overview & Revenue Model
Company Description
National Grid plc engages in the transmission and distribution of electricity and gas. It operates through UK Electricity Transmission, UK Electricity Distribution, New England, New York, National Grid Ventures, and Other segments. The UK Electric...
How the Company Makes Money
National Grid primarily makes money through regulated network revenues earned for operating, maintaining, and investing in electricity and gas infrastructure. Its main revenue streams come from (1) electricity transmission and/or distribution char...
National Grid Transco Earnings Call Summary
Earnings Call Date:May 14, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call outlines a strong growth and delivery story: materially higher capital investment (at least GBP 70bn), clear multi-year EPS and RAV targets, strong operating performance and technology-led productivity initiatives. Management backed this with specific execution actions (capital control tower, standardized designs, AI pilots) and measurable early wins (reliability, customer satisfaction, productivity and contracted supply). Key risks remain: higher net debt and leverage as investment ramps, NGV profit and capex contraction, storm/regulatory headwinds in parts of the U.S., commodity and supply-chain inflation, and some regulatory uncertainty (ED3) that may limit the pace at which efficiency gains convert into shareholder returns. On balance, the positive operational progress, visibility of regulatory coverage, and credible execution plans outweigh the risks, though execution and regulatory outcomes will be critical to realize the stated financial targets.Positive Updates
Material Step-Up in Capital Investment and Asset Growth
Group CapEx increased by more than 20% to GBP 11.6bn for the year, driving asset growth of 10.9%. Management set a five-year investment program of at least GBP 70bn (largest ever), supporting ~10% annual asset growth and providing strong multi-year visibility.
Negative Updates
Net Debt Increase and Leverage Headroom
Net debt rose by GBP 2.8bn to GBP 44.2bn (constant currency). Management expects regulatory gearing to move back up toward the high‑60% area over the five‑year frame, creating higher leverage compared with current levels.
Read all updates
Q4-2026 Updates
Positive
Negative
Material Step-Up in Capital Investment and Asset Growth
Group CapEx increased by more than 20% to GBP 11.6bn for the year, driving asset growth of 10.9%. Management set a five-year investment program of at least GBP 70bn (largest ever), supporting ~10% annual asset growth and providing strong multi-year visibility.
Read all positive updates
Company Guidance
The call guided to a five‑year investment program of at least GBP 70 billion (with ~2/3 already covered by regulatory agreements and delivery mechanisms secured for 3/4, including 100% of primary ASTI supply chain), driving ~10% p.a. asset growth, an underlying EPS CAGR of 8%–10% and progressive dividends in line with CPIH; FY‑2026 results included CapEx up >20% to GBP 11.6 billion, asset growth 10.9%, underlying operating profit GBP 5.7 billion, underlying EPS +8% at constant currency and DPS +3.8%, and cash from operations GBP 7.9 billion (up 15%) with net debt ~GBP 44.2 billion; FY‑2027 guidance expects CapEx ~+10% to nearly GBP 13 billion and underlying EPS +13%–15% from a FY‑2026 baseline of GBP 0.78; regional five‑year plans include ~GBP 40 billion UK (GBP 31 billion transmission, GBP 9 billion distribution) and ~GBP 29 billion US (GBP 17 billion New York, GBP 12 billion New England), UK RAV >60% growth to >GBP 60 billion, US regulated asset base ~+50% to >GBP 45 billion, plans to connect up to 35 GW new generation and 19 GW new demand, build ~7,500 km of network and recruit ~6,000 FTE (2,000 graduates/apprentices); operational metrics cited include UK transmission reliability 99.99999%, contracted spend of GBP 2.5 billion (Eastern Green Link 3/4) and GBP 1 billion (CLCPA phase II), Massachusetts FLISR covering 34% customers (avoiding >15 million customer outage minutes in six months), >2 million US smart meters, an 18% increase in after‑call satisfaction, a 30% reduction in crew travel time in a NY pilot, and expected UK customer savings (dynamic line rating) up to GBP 50 million over five years.National Grid Transco Financial Statement Overview
Summary
Income Statement
70
Positive
Balance Sheet
58
Neutral
Cash Flow
45
Neutral
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 17.97B | 18.38B | 19.85B | 21.66B | 18.45B |
| Gross Profit | 5.87B | 14.23B | 14.58B | 13.04B | 12.35B |
| EBITDA | 7.85B | 7.63B | 6.83B | 7.25B | 6.43B |
| Net Income | 3.29B | 2.90B | 2.29B | 7.80B | 2.35B |
Balance Sheet | |||||
| Total Assets | 108.29B | 106.74B | 98.33B | 92.70B | 94.86B |
| Cash, Cash Equivalents and Short-Term Investments | 2.83B | 6.93B | 4.25B | 2.73B | 3.33B |
| Total Debt | 46.76B | 47.54B | 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 | -3.82B | -3.39B | -1.27B | -585.92M | 340.31M |
| Operating Cash Flow | 6.33B | 5.27B | 5.64B | 5.57B | 5.65B |
| Investing Cash Flow | -4.57B | -10.87B | -7.83B | -14.60M | -14.79B |
| Financing Cash Flow | -2.73B | 6.36B | 2.62B | -5.59B | 9.18B |
National Grid Transco Technical Analysis
Negative
75.51
Price Trends
82.80
Negative
84.51
Negative
79.86
Positive
Market Momentum
0.13
Negative
49.81
Neutral
71.95
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NGG, the sentiment is Negative. The current price of 75.51 is below the 20-day moving average (MA) of 82.04, below the 50-day MA of 82.80, and below the 200-day MA of 79.86, indicating a neutral trend. The MACD of 0.13 indicates Negative momentum. The RSI at 49.81 is Neutral, neither overbought nor oversold. The STOCH value of 71.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NGG.
National Grid Transco Risk Analysis
National Grid Transco disclosed 9 risk factors in its most recent earnings report. National Grid Transco 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 Transco Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $73.94B | 19.65 | 11.86% | 3.25% | 9.38% | 31.12% | |
66 Neutral | $108.65B | 24.15 | 12.28% | 3.40% | 8.33% | -6.26% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $98.85B | 19.18 | 9.85% | 3.61% | 7.21% | 8.97% | |
61 Neutral | $83.40B | 18.64 | 8.47% | 4.03% | 1.13% | 13.83% | |
61 Neutral | $61.44B | 20.43 | 10.51% | 4.59% | 19.15% | 27.09% | |
59 Neutral | $48.38B | 16.93 | 9.76% | 3.68% | 4.58% | 1.43% |
* Utilities Sector Average
NGG
National Grid Transco
82.32
14.86
22.04%
AEP
American Electric Power
133.85
31.74
31.09%
D
Dominion Energy
69.45
14.49
26.36%
DUK
Duke Energy
125.26
11.77
10.37%
EXC
Exelon
46.38
4.39
10.44%
SO
Southern Co
95.17
5.44
6.07%
National Grid Transco Corporate Events
National Grid Raises $750 Million via 5.405% Notes Due 2036
Jun 9, 2026
National Grid plc has issued U.S.$750 million of 5.405% notes due 2036, under an existing shelf registration on Form F-3, as part of its ongoing funding strategy for long-term obligations. The transaction, supported by a June 4, 2026 underwriting ...
National Grid Sets Scrip Reference Price and Timetable for 2025/26 Final Dividend
Jun 4, 2026
National Grid plc on 4 June 2026 set the scrip dividend reference price for its 2025/26 final dividend, giving ordinary shareholders a scrip price of 1,197.70 pence per share based on the average closing mid-market price over the five days from th...
National Grid Announces Board Departure Ahead of July 2026 AGM
Jun 3, 2026
National Grid announced on 2 June 2026 that non-executive director Jonathan Silver will not stand for re-election at the company’s Annual General Meeting on 14 July 2026 and will step down from the board at the close of that meeting, ending ...
National Grid Publishes 2025/26 Annual Report and Sets 2026 Hybrid AGM for July
Jun 3, 2026
National Grid plc has published its 2025/26 Annual Report and Accounts, its Annual Report on Form 20-F and the Notice of its 2026 Annual General Meeting, with these documents now available on the company’s website and submitted to the UK Fin...
National Grid Updates Voting Capital and Reports May Insider Share Purchases
May 29, 2026
In May 2026, National Grid plc reported that as of 30 April 2026 its issued share capital comprised 5.2 billion ordinary shares, with 223.4 million held in treasury and 4.98 billion shares carrying voting rights, a key reference figure for investo...
National Grid Unveils £70bn Investment Plan as FY2026 Profits and Payouts Rise
May 14, 2026
On 14 May 2026, National Grid reported full-year results for the period ended 31 March 2026, highlighting record capital investment of £11.6 billion, 10.9% asset growth and underlying earnings per share up 8% at constant currency to 78.0p. St...
National Grid Updates Voting Share Capital and Discloses Routine PDMR Dealings
Apr 30, 2026
National Grid plc reported that as of 31 March 2026 its registered capital comprised 5,198,968,690 ordinary shares, of which 225,541,858 were held in treasury, leaving 4,973,426,832 shares in issue with voting rights for regulatory disclosure calc...
National Grid Flags Modest EPS Impact in Pre-Close Update for 2025/26
Apr 13, 2026
National Grid said on 13 April 2026 that trading for the year to 31 March 2026 remained in line with expectations and prior guidance, ahead of publishing full-year results in May. The company flagged an estimated net 1 pence per share reduction to...
National Grid Updates Voting Rights and Discloses March Share Purchase by CFO
Mar 31, 2026
National Grid plc reported that as of 28 February 2026 its issued share capital comprised 5,198,968,690 ordinary shares, of which 227,659,512 were held in treasury, leaving 4,971,309,178 shares carrying voting rights. This voting rights figure ser...
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.