NiSource (NI) just posted another quarter of steady utility earnings, with Q3 FY 2025 revenue of US$1.3 billion and basic EPS of US$0.20, and trailing twelve month EPS of US$1.90 on revenue of US$6.3 billion, giving you a clear picture of its current earnings power. Over the past few quarters, revenue has ranged from US$1.1 billion to US$2.2 billion while quarterly EPS has moved between US$0.19 and US$1.01, feeding into that trailing net income of US$893.5 million. With earnings growth, revenue forecasts and a 14.1% net margin profile in play, investors are likely to focus on how durable these margins look against the broader growth story.

See our full analysis for NiSource.

With the headline numbers on the table, the next step is to see how they line up with the widely held narratives around NiSource’s growth profile, risk factors and long term earnings power.

20.7% earnings growth and steady margins

• Over the last 12 months, NiSource generated US$893.5 million of net income on US$6.3b of revenue, giving that 14.1% net margin alongside 20.7% earnings growth.
• Analysts' consensus view ties this earnings growth to big infrastructure and digital upgrades, and the current numbers partly back that up while also highlighting some pressure points:
  • The 14.1% margin lines up with the consensus idea that grid and gas system modernization can support solid profitability. However, the latest two quarters show more modest quarterly net income of US$94.4 million and US$101.9 million compared with US$474 million in Q1 FY 2025, which keeps the pace of earnings growth in focus.
  • Consensus also leans on regulated revenue growth, and the trailing revenue of US$6.3b supports that regulated base. Although trailing revenue growth is described as slower than the broader US market, the story depends more on steady margins than fast top line expansion.

Over the past year, NiSource’s earnings jump and firm margin give bulls plenty to talk about, but the quarterly swings and slower revenue growth versus the wider market leave room for debate on how smooth that path really is. 📊 Read the full NiSource Consensus Narrative.

P/E of 23.9x versus DCF fair value

• NiSource trades on a P/E of 23.9x compared with peers at 27x and the Global Integrated Utilities industry at 19.3x, while the DCF fair value of US$38.39 sits below the current share price of US$44.66.
• Critics highlight valuation as a key bearish angle, and the data here gives them some support but not a slam dunk:
  • The gap between the current price of US$44.66 and the DCF fair value of US$38.39 backs the bearish view that the market is paying up relative to modeled cash flows, even though the P/E is still lower than the 27x peer average.
  • At the same time, the stock trades on a higher multiple than the 19.3x industry average, so anyone leaning on the bearish narrative has to weigh that valuation premium against the 20.7% earnings growth and higher margin quality described in the analysis data.

Skeptics argue that paying above DCF fair value only works if earnings growth stays strong, so this mixed valuation picture is where a lot of the disagreement is likely to sit. 🐻 NiSource Bear Case

Dividend and interest coverage pressures

• NiSource’s 2.69% dividend yield is flagged as not well covered by free cash flow, and interest payments are also described as not well covered by earnings.
• Supporters with a bullish tilt often point to regulated earnings visibility, but these coverage metrics introduce a clear tension in that story:
  • The bullish view leans on steady, regulated cash flows to fund a US$6.3b revenue base and US$893.5 million of net income. Yet weak free cash flow coverage of the dividend suggests a fair amount of that earnings power is being absorbed by capital spending or non cash items instead of excess cash.
  • Concerns about interest coverage sit alongside large capex commitments in gas and electric infrastructure, so even with 20.7% earnings growth, the bullish case has to account for how much room is left for debt service and shareholder payouts if those investment levels remain high.

Bulls arguing that NiSource’s regulated model makes it “sleep well at night” still need to keep an eye on how dividend and interest coverage interact with the ongoing build out of its asset base. 🐂 NiSource Bull Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for NiSource on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

See something different in the figures? Take a couple of minutes to test that view against the full dataset and shape your own story: Do it your way.

A great starting point for your NiSource research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

See What Else Is Out There

NiSource’s mix of a P/E above the industry average, DCF value below the current share price, and weak dividend and interest coverage may leave you wanting stronger fundamentals.

If those valuation questions and cash flow pressures feel like red flags, you might want to shift your attention to solid balance sheet and fundamentals stocks screener (45 results) that can offer sturdier financial footing and potentially more resilient income.

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.