NiSource Outperforms 4Q Earnings Estimates, Misses On Revenues

NiSource reported better-than-expected earnings in the fourth quarter, but lagged analysts’ expectations for revenues. Shares of the natural gas and electric utility rose 1.3% to close at $22.67 on Feb.17.

NiSource’s (NI) 4Q adjusted earnings dropped 24.4% to $0.34 per share on a year-over-year basis, but beat the Street’s estimates of $0.33. Revenues declined 12.7% to $1.21 billion and came in below analysts’ expectations of $1.54 billion.

The company’s gas distribution operations reported revenues of $833.9 million, down 16.2% year-over-year. Revenues generated from electric operations declined 5.6% to $371.3 million.

For 2021, the company reaffirmed its outlook and expects adjusted EPS to come in at a range of $1.28 to $1.36. Capital investments are forecasted to be in the range of $1.9 billion to $2.1 billion. (See NiSource stock analysis on TipRanks)

NiSource CEO Joe Hamrock said, “In Indiana, we completed two wind power projects in December, and we continue to expect that our infrastructure and generation investments will drive compound annual growth of 7 to 9 percent in net operating earnings per share from 2021 through 2024 while reducing greenhouse gas emissions 90 percent by 2030.”

On Jan. 28, Goldman Sachs analyst Insoo Kim downgraded the stock to Hold from Buy and trimmed the price target to $25 (10.3% upside potential) from $27. The analyst cited “potential guidance and consensus risk from increased rate case overhang at its gas utility segment, along with the company’s elevated equity financing needs.”

The consensus rating among analysts is a Strong Buy based on 3 Buys and 1 Hold. The average analyst price target stands at $27.50 and implies upside potential of about 21% to current levels.

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