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National Grid Transco Plc (NGG)
NYSE:NGG
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National Grid Transco
(NYSE:NGG)
Rating:71Outperform
Price Target:
$79.00
â–²(12.70% Upside)
National Grid Transco (NGG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$68.39B
Dividend Yield4.39%
Average Volume (3M)648.19K
Price to Earnings (P/E)17.5
Beta (1Y)0.21
Revenue Growth-6.02%
EPS Growth7.24%
CountryUS
Employees31,425
SectorUtilities
Sector Strength62
IndustryRegulated Electric
Share Statistics
EPS (TTM)3.06
Shares Outstanding992,263,200
10 Day Avg. Volume510,947
30 Day Avg. Volume648,186
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.71
Enterprise Value/Revenue6.35
Enterprise Value/Gross Profit6.35
Enterprise Value/Ebitda16.29
Forecast
1Y Price Target
$79.00Price Target Upside12.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
National Grid Transco Business Overview & Revenue Model
Company DescriptionNational Grid Transco (NGG) is a leading energy company focused on the transmission and distribution of natural gas and electricity across the United Kingdom and the northeastern United States. The company operates essential infrastructure, including high-voltage electricity transmission lines and extensive gas pipeline networks, ensuring reliable energy supply to millions of customers. NGG is committed to sustainability and innovation, investing in renewable energy sources and advanced technologies to improve energy efficiency and reduce carbon emissions.
How the Company Makes MoneyNational Grid Transco generates revenue primarily through regulated energy transmission and distribution services. The company earns money by charging utility companies and consumers for the use of its infrastructure, which is regulated by government agencies to ensure fair pricing. Key revenue streams include transmission tariffs for electricity and transportation charges for natural gas, which are determined based on the volume of energy transported and the prevailing regulatory frameworks. Additionally, NGG benefits from strategic partnerships with energy producers and technology providers, which enhance its service capabilities and expand its market reach. The company's investment in renewable energy projects and energy efficiency initiatives also contributes to its revenue by aligning with growing demand for sustainable energy solutions.
National Grid Transco Key Performance Indicators (KPIs)
Any
Operating Profit by Segment
Reveals the profitability of each business segment, highlighting which areas are driving earnings and where there may be challenges or opportunities for growth.
Reveals the profitability of each business segment, highlighting which areas are driving earnings and where there may be challenges or opportunities for growth.
Data provided by:
Main Street Data
Main Street DataNational Grid Transco Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The earnings call revealed robust financial performance with record capital investments and strategic regulatory progress, particularly in the U.S. However, challenges such as severe weather impacts, project delays, and significant impairments balanced the positive aspects.Q4-2025 Updates
Positive Updates
Record Capital Investment
National Grid delivered record capital investment of £9.8 billion, a 20% increase from last year, reflecting significant progress across all regulated businesses.
Strong Financial Performance
Underlying operating profit increased by 12% to £5.4 billion at constant currency, driven by increased regulated revenues and flat controllable costs.
Regulated Asset Growth
Helped by the capital investment, National Grid achieved a regulated asset growth of 10.5%.
Dividend Increase
The Board declared a final dividend of 30.88p per share, taking the total dividend for the year to 46.72p, an increase of 3.21% from the previous year.
UK Electricity Transmission Achievements
Investment increased by 57% to £3 billion, with the business delivering a return on equity of 8.3%, outperforming its allowed return by 100 basis points.
U.S. Regulatory Progress
New rates in Massachusetts and New York, including an improved return on equity of 9.5% for the Niagara Mohawk business.
Negative Updates
Challenges from Storm Darragh
Storm Darragh caused substantial damage, impacting the Electricity Distribution segment's performance with costs affecting incentives and revenue.
Community Offshore Wind Impairment
National Grid announced an accounting impairment for its Community Offshore Wind joint venture due to policy uncertainty, totaling £303 million.
Delays in Eastern Green Links 1 Project
There is a 16-month delay in the £2.5 billion Eastern Green Links 1 project, with potential penalties from Ofgem.
Electricity Distribution Return on Equity
Return on equity for UK Electricity Distribution was lower than expected at 7.9%, affected by cost impacts not matching allowances.
Company Guidance
During the call, National Grid provided robust guidance for its future strategy, focusing on significant capital investment and asset growth. The company reaffirmed its commitment to a five-year financial framework, aiming for £60 billion in capital investment, which is expected to drive asset growth of around 10% per annum. This investment is projected to yield an underlying earnings per share (EPS) growth of 6% to 8%, while maintaining a strong balance sheet and delivering an inflation-protected dividend. The company reported a record £9.8 billion in capital investment for the year, a 20% increase from the previous year, contributing to a 10.5% growth in regulated asset base. National Grid also highlighted its achievements in regulatory agreements, securing over 70% of its U.S. investment with regulators and progressing with its strategic infrastructure projects. The company expressed confidence in its ability to deliver its £60 billion investment program and outlined plans for continued engagement with regulatory bodies to refine investment needs and secure future growth.National Grid Transco Financial Statement Overview
Summary
National Grid Transco demonstrates strong operational efficiency with high gross margins and consistent operating cash flow. However, challenges include fluctuating revenue growth, high capital expenditures impacting free cash flow, and significant liabilities on the balance sheet.Income Statement
National Grid Transco shows a strong gross profit margin consistently above 75%, indicating effective management of production costs. However, net profit margin fluctuates, with a significant drop in recent years, reflecting increased expenses or reduced revenue efficiency. Revenue growth is inconsistent, peaking in 2023 but declining in 2024 and 2025, which may signal market pressures or strategic shifts impacting sales. EBIT and EBITDA margins are healthy, suggesting operational efficiency, though EBIT margin has varied, warranting attention to operational costs.75
Positive
Balance Sheet
The company's debt-to-equity ratio indicates a moderate level of leverage, typical for a regulated utility, but requires monitoring to ensure it doesn't impede future financing. The return on equity has shown variability, with a notable peak in 2023, suggesting fluctuating profitability relative to shareholder investments. The equity ratio is stable, reflecting a solid asset base, but continued large liabilities could pose risks if not managed carefully.70
Positive
Cash Flow
Operating cash flow remains strong, consistently covering net income, which is a positive sign of cash-generating capacity. However, the free cash flow is negative in most years, indicating heavy capital expenditures that exceed operating cash flow, potentially affecting liquidity. The free cash flow to net income ratio also suggests challenges in converting profits into free cash flow, highlighting a need for careful capital allocation.65
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 18.38B | 18.38B | 19.85B | 21.66B | 18.45B | 13.66B |
| Gross Profit | 18.38B | 14.23B | 14.55B | 13.41B | 11.42B | 8.05B |
| EBITDA | 7.17B | 7.63B | 6.83B | 5.59B | 6.04B | 3.93B |
| Net Income | 2.90B | 2.90B | 2.29B | 7.80B | 2.35B | 1.64B |
Balance Sheet | ||||||
| Total Assets | 106.74B | 106.74B | 98.33B | 92.70B | 94.86B | 67.22B |
| Cash, Cash Equivalents and Short-Term Investments | 6.93B | 6.93B | 4.25B | 2.77B | 3.35B | 2.50B |
| Total Debt | 47.54B | 47.54B | 47.07B | 42.98B | 45.47B | 31.22B |
| Total Liabilities | 68.92B | 68.92B | 68.43B | 63.13B | 71.00B | 47.36B |
| Stockholders Equity | 37.80B | 37.80B | 29.87B | 29.54B | 23.83B | 19.84B |
Cash Flow | ||||||
| Free Cash Flow | -1.97B | -2.50B | -514.00M | 573.00M | -119.00M | -804.00M |
| Operating Cash Flow | 6.81B | 6.81B | 6.94B | 6.90B | 5.42B | 3.80B |
| Investing Cash Flow | -10.57B | -10.57B | -7.50B | 240.00M | -14.22B | -5.21B |
| Financing Cash Flow | 4.53B | 4.53B | 987.00M | -7.17B | 8.82B | 1.50B |
National Grid Transco Technical Analysis
Neutral
70.10
Price Trends
71.34
Negative
70.93
Negative
65.40
Positive
Market Momentum
-0.55
Positive
47.05
Neutral
38.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NGG, the sentiment is Neutral. The current price of 70.1 is below the 20-day moving average (MA) of 70.64, below the 50-day MA of 71.34, and above the 200-day MA of 65.40, indicating a neutral trend. The MACD of -0.55 indicates Positive momentum. The RSI at 47.05 is Neutral, neither overbought nor oversold. The STOCH value of 38.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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
Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $50.17B | 20.36 | 9.29% | 4.59% | 7.60% | 55.99% | |
74 Outperform | $58.88B | 16.13 | 13.03% | 3.44% | 5.84% | 36.33% | |
73 Outperform | $93.99B | 19.86 | 9.60% | 3.48% | 4.07% | 9.94% | |
73 Outperform | $43.80B | 16.46 | 9.87% | 3.64% | 4.46% | 8.68% | |
71 Outperform | $68.39B | 17.53 | 8.31% | 4.39% | -6.02% | 7.24% | |
66 Neutral | $17.25B | 17.99 | 5.54% | 3.64% | 6.63% | 11.55% | |
65 Neutral | $101.06B | 23.72 | 12.89% | 3.18% | 8.53% | -7.53% |
* Utilities Sector Average
Performance Comparison
NGG
National Grid Transco
70.10
5.43
8.40%
AEP
American Electric Power
108.11
9.68
9.83%
D
Dominion Energy
58.19
3.68
6.75%
DUK
Duke Energy
120.61
8.17
7.27%
EXC
Exelon
43.43
6.62
17.98%
SO
Southern Co
91.78
6.24
7.29%
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.