Q1 earnings and new partnerships set the tone

NiSource (NI) set the stage for its stock story this year with Q1 2026 results that showed higher revenue and net income, reaffirmed earnings guidance, and a higher long term earnings growth target.

The company paired those numbers with fresh partnerships with Alphabet and Amazon, plus new fixed rate notes due 2031 and 2036. Together, these moves highlight how NiSource is funding and shaping its next phase of grid and data center related projects.

At a share price of $47.03, NiSource has seen an 11.55% year to date share price return and a 26.01% total shareholder return over the past year, with long term total shareholder returns above 100% suggesting momentum that has been building rather than fading.

If NiSource's grid and data center plans have your attention, it can be useful to compare it with other infrastructure focused opportunities and scan 36 power grid technology and infrastructure stocks

With the stock up 11.55% year to date and trading about 9% below the average analyst price target of $51.29, you have to ask: Is NiSource still underappreciated, or is the market already baking in years of future growth?

Most Popular Narrative: 7.4% Undervalued

Analysts see NiSource's fair value at $50.79, which sits modestly above the last close of $47.03 and helps frame the current optimism around its data center and grid build out story.

Strong visibility into multi-year, rate-based capital expenditure (with a $19.4B base plan, plus $2B+ in upside or incremental projects) positions NiSource for 6 to 8% annual EPS growth and compound growth in regulated revenue.

Want to see what sits behind that growth blueprint? The narrative leans on rising data center demand, thicker margins, and a future earnings multiple that is anything but conservative.

Result: Fair Value of $50.79 (UNDERVALUED)

However, that story can change quickly if regulatory decisions delay cost recovery on the US$19.4b capital plan, or if long term gas demand weakens faster than expected.

Another angle on valuation

Analysts see NiSource as 7.4% undervalued based on their fair value of $50.79. However, the current P/E of 23.4x sits above the global integrated utilities average of 18.5x, the peer average of 22.5x, and even the 23x fair ratio. This points to a richer pricing that could limit upside if sentiment cools.

For many investors, the real question is whether to trust the earnings narrative that supports that premium or treat the gap to the fair ratio as a warning signal that expectations leave less room for error, especially with heavy capital needs still ahead.

Next Steps

With the debate between richer valuation and growth potential in mind, it makes sense to move quickly, review the numbers carefully, and consider both sides of the story using 2 key rewards and 2 important warning signs

Looking for more investment ideas?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.