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Nisource Inc (NI)
NYSE:NI
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Nisource
(NYSE:NI)
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Rating:65Neutral
Price Target:
$44.00
â–²(9.56% Upside)
Nisource's strong earnings call performance and strategic initiatives are offset by financial risks from high leverage and negative cash flow. Technical indicators suggest weak momentum, and valuation concerns persist.
Positive Factors
Regulatory Approvals
Successful regulatory approvals enhance revenue stability and growth, strengthening NiSource's market position and financial outlook.
Operational Efficiency
AI-driven productivity improvements indicate enhanced operational efficiency, supporting sustainable margin expansion and competitive advantage.
Strategic Growth Initiatives
Timely execution of growth initiatives in renewable energy and infrastructure supports long-term revenue expansion and aligns with sustainable energy trends.
Negative Factors
High Leverage
High leverage can limit financial flexibility and increase vulnerability to interest rate hikes, impacting long-term financial stability.
Negative Cash Flow
Negative free cash flow suggests insufficient cash generation relative to net income, potentially hindering future investments and growth.
Regulatory Challenges
Ongoing regulatory challenges may delay project timelines and contract finalizations, impacting future growth and operational execution.
Nisource (NI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.65B
Dividend Yield2.75%
Average Volume (3M)4.18M
Price to Earnings (P/E)20.9
Beta (1Y)0.36
Revenue Growth16.98%
EPS Growth12.45%
CountryUS
Employees7,687
SectorUtilities
Sector Strength65
IndustryRegulated Gas
Share Statistics
EPS (TTM)0.22
Shares Outstanding470,855,000
10 Day Avg. Volume5,682,600
30 Day Avg. Volume4,182,900
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 Cap1.96
Enterprise Value/Revenue5.96
Enterprise Value/Gross Profit11.88
Enterprise Value/Ebitda13.03
Forecast
1Y Price Target
$45.00Price Target Upside12.05% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Nisource Business Overview & Revenue Model
Company DescriptionNiSource 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.
How the Company Makes MoneyNiSource earns revenue primarily through the distribution of natural gas and electricity to residential, commercial, and industrial customers. The company operates under a regulated utility model, meaning its rates and earnings are overseen by state public utility commissions. Key revenue streams include residential and commercial utility billing, which are influenced by the volume of gas and electricity consumed. Additionally, NiSource engages in infrastructure investments that enhance its service delivery and reliability, which can lead to incremental revenue growth. The company may also benefit from partnerships with local and state governments, energy efficiency programs, and renewable energy initiatives that align with regulatory frameworks and customer demand for sustainable energy solutions.
Nisource Key Performance Indicators (KPIs)
Nisource Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong financial performance with significant regulatory approvals and strategic growth initiatives underway. However, there are challenges related to ongoing regulatory processes and potential delays in infrastructure projects.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Second quarter adjusted EPS was $0.22, bringing year-to-date total to $1.19. The company is on track to deliver on its full-year commitment and is narrowing 2025 adjusted EPS guidance to the upper half of the previously stated range of $1.85 to $1.89.
Successful Regulatory Approvals
Final orders received in Virginia and Indiana, including a $40.7 million revenue increase in Virginia and a $257 million revenue uplift in Indiana.
AI and Operational Excellence
Deployment of AI capabilities has improved productivity by up to 24%, equivalent to over 83,000 incremental work hours. Expansion of AI into supply chain and system reliability.
Infrastructure and Growth Initiatives
Projects like Templeton Wind are on track for commercial operation in 2027. Significant investments in renewable energy and infrastructure are on time and within budget.
Strategic Growth and Economic Development
Economic development initiatives in Indiana with projects expected to generate over 2,600 jobs and significant investments in data centers and logistics.
Strong Financing and Credit Position
Issued $1.65 billion of senior notes, maintaining strong credit ratings with stable outlooks from S&P, Moody's, and Fitch, eliminating near-term refinancing risk.
Negative Updates
Uncertainty in Data Center Development
Complex negotiations and regulatory processes are ongoing. The GenCo application is still under review, and achieving a final outcome may affect timelines.
Potential Delays in Coal Plant Retirements
Discussions with state authorities regarding potential extensions for coal plant operations could impact the planned retirements and related cost recoveries.
Regulatory and Contractual Challenges
Continued negotiations and regulatory approvals required for new customer contracts and infrastructure development pose potential challenges.
Company Guidance
During the Q2 2025 earnings call, NiSource provided detailed guidance on its financial and operational performance. The company reported a second-quarter adjusted EPS of $0.22, bringing the year-to-date total to $1.19, and narrowed its 2025 adjusted EPS guidance to the upper half of the previously stated range of $1.85 to $1.89. Key operational achievements include a 24% improvement in steel productivity and 83,000 incremental work hours through advanced AI capabilities. NiSource completed 9,966 miles of leak surveys in Q2, surpassing its goal. Regulatory successes included a $40.7 million revenue increase in Virginia and a $257 million uplift in Indiana. The company is on track to retire the Schahfer plant by the end of 2025 and Michigan City by the end of 2028, while maintaining a $19.4 billion five-year capital plan. NiSource reaffirmed its long-term commitments of 6% to 8% annual adjusted EPS growth and 8% to 10% rate base growth.Nisource Financial Statement Overview
Summary
NiSource demonstrates strong operational efficiency and profitability with robust margins and revenue growth. However, high leverage and negative free cash flow pose risks to financial flexibility. The income statement is a strong point, but the balance sheet and cash flow statements highlight areas needing careful management.Income Statement
Nisource's income statement shows a solid performance with a consistent increase in revenue over the TTM period, achieving a revenue growth rate of 3.34%. The company maintains healthy margins, with a gross profit margin of 50.17% and a net profit margin of 14.46%. EBIT and EBITDA margins are strong at 27.83% and 45.66%, respectively, indicating efficient operations. However, the revenue growth has been inconsistent in previous years, which could pose a risk if not stabilized.75
Positive
Balance Sheet
The balance sheet reflects a high debt-to-equity ratio of 1.77, indicating significant leverage, which could be a potential risk if interest rates rise. Return on equity is moderate at 10.19%, suggesting decent profitability for shareholders. The equity ratio stands at 26.09%, showing a balanced asset structure but highlighting the reliance on debt financing.65
Positive
Cash Flow
Cash flow analysis reveals challenges, with a negative free cash flow and a declining free cash flow growth rate of -350.7% in the TTM period. The operating cash flow to net income ratio is 0.60, indicating that operating cash flow is not fully covering net income. The negative free cash flow to net income ratio of -31.90% suggests that the company is not generating sufficient free cash flow relative to its net income, which could impact future investments.55
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.13B | 5.46B | 5.51B | 5.85B | 4.90B | 4.68B |
| Gross Profit | 3.08B | 2.81B | 2.49B | 2.25B | 2.05B | 1.99B |
| EBITDA | 2.80B | 2.57B | 2.22B | 2.15B | 1.80B | 1.07B |
| Net Income | 886.60M | 760.40M | 714.30M | 804.10M | 584.90M | -17.60M |
Balance Sheet | ||||||
| Total Assets | 34.03B | 31.79B | 31.08B | 26.74B | 24.16B | 22.04B |
| Cash, Cash Equivalents and Short-Term Investments | 335.40M | 156.60M | 2.25B | 40.80M | 84.20M | 116.50M |
| Total Debt | 15.76B | 13.96B | 14.13B | 11.53B | 9.99B | 9.95B |
| Total Liabilities | 23.03B | 21.12B | 20.94B | 18.83B | 16.88B | 16.20B |
| Stockholders Equity | 8.88B | 8.68B | 8.27B | 7.58B | 6.95B | 5.75B |
Cash Flow | ||||||
| Free Cash Flow | -657.60M | -861.50M | -710.70M | -793.70M | -620.10M | -654.10M |
| Operating Cash Flow | 2.06B | 1.78B | 1.94B | 1.41B | 1.22B | 1.10B |
| Investing Cash Flow | -4.19B | -3.21B | -3.57B | -2.57B | -2.20B | -879.10M |
| Financing Cash Flow | 2.35B | -651.00M | 3.84B | 1.14B | 956.30M | -247.70M |
Nisource Technical Analysis
Negative
40.16
Price Trends
41.44
Negative
40.27
Negative
38.91
Positive
Market Momentum
-0.49
Positive
42.16
Neutral
29.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NI, the sentiment is Negative. The current price of 40.16 is below the 20-day moving average (MA) of 41.22, below the 50-day MA of 41.44, and above the 200-day MA of 38.91, indicating a neutral trend. The MACD of -0.49 indicates Positive momentum. The RSI at 42.16 is Neutral, neither overbought nor oversold. The STOCH value of 29.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NI.
Nisource Risk Analysis
Nisource disclosed 41 risk factors in its most recent earnings report. Nisource reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nisource Peers Comparison
Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 26.24B | 22.57 | 8.65% | 2.14% | 12.90% | 7.70% | |
76 Outperform | 4.66B | 11.34 | 13.17% | 3.84% | 21.88% | 71.35% | |
71 Outperform | 4.49B | 16.44 | 8.21% | 4.11% | -6.65% | 11.47% | |
67 Neutral | 5.69B | 29.46 | 5.27% | 3.14% | -10.07% | 5.98% | |
65 Neutral | $18.65B | 20.92 | 10.56% | 2.75% | 16.98% | 12.45% | |
61 Neutral | 7.06B | 17.32 | 8.58% | 4.55% | -0.52% | -39.42% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% |
* Utilities Sector Average
Performance Comparison
NI
Nisource
40.16
7.29
22.18%
ATO
Atmos Energy
162.44
29.20
21.92%
SR
Spire
76.42
12.43
19.42%
NJR
New Jersey Resources
46.85
0.95
2.07%
SWX
Southwest Gas
79.00
7.18
10.00%
UGI
UGI
33.00
9.61
41.09%
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.