NI

NiSource is a regulated electric and natural gas utility, so its core moat is predictable, commission-set returns tied to capital investment rather than price competition. The emerging differentiator is incremental large-load demand: management is leaning into Indiana data center growth, including a long-term energy supply agreement with an Alphabet subsidiary and an expanded arrangement with Amazon sites, which could improve territory growth while keeping the utility model largely intact. The key question is whether these contracts translate into timely, regulator-approved investments that protect existing customers from cost shifts.

Financially, recent disclosed results show improving earnings power: FY2025 GAAP EPS was $1.95 and non-GAAP adjusted EPS was $1.90, up from $1.75 in FY2024, and 2026 consolidated adjusted EPS guidance is $2.02–$2.07 (base plan $2.01–$2.05 plus $0.01–$0.02 from GenCo/data center). That implies roughly high-single-digit growth off 2025, consistent with management’s longer-term growth narrative, but valuation already embeds optimism (recent commentary has NI trading around the mid-20s P/E). Balance-sheet and cash-flow detail is harder to validate from the limited consolidated data surfaced here, but the multi-year capex plan and special-contract structure add execution and financing sensitivity if rates or regulatory outcomes disappoint.

Over the next 12 months, upside catalysts are approval/implementation progress on large-load “special contract” frameworks in Indiana, incremental signed data center load beyond current commitments, and clean delivery on the 2026 EPS range. The main risks are regulatory pushback on customer protections, construction/timing slippage for generation and grid upgrades tied to GenCo, and multiple compression if utilities fall out of favor or interest rates rise.

Recommendation: HOLD. The contracts with Alphabet/Amazon and 2026 EPS guide support a credible growth step-up, but the stock’s valuation and regulatory/execution complexity around GenCo reduce near-term margin of safety.