Nisource Inc. (NYSE: NI)

Sector: Utilities Industry: Utilities - Regulated Gas CIK: 0001111711
Market Cap 14.62 Bn
P/B 2.48
P/E 27.48
P/S 3.16
ROIC (Qtr) 6.01
Div Yield % 2.76
Rev 1y % (Qtr) 19.85
Total Debt (Qtr) 16.21 Bn
Debt/Equity (Qtr) 1.72
Add ratio to table...

About

Investment thesis

Bull case

  • Operating cash flow of 2.36B provides exceptional 28.43x coverage of minority interest expenses 83.10M, showing strong core operations.
  • Operating cash flow of 2.36B provides strong 46.41x coverage of stock compensation 50.90M, indicating sustainable incentive practices.
  • Tangible assets of 34.37B provide robust 23.68x coverage of other current liabilities 1.45B, indicating strong asset backing.
  • Operating cash flow of 2.36B provides strong 5.26x coverage of inventory 449.50M, indicating efficient inventory management.
  • Operating cash flow of 2.36B provides solid 0.68x coverage of current liabilities 3.46B, showing strong operational health.

Bear case

  • Operating cash flow of 2.36B barely covers its investment activities of (4.52B), with a coverage ratio of -0.52, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 2.36B provides thin coverage of dividend payments of (530.40M) with a -4.45 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • High receivables of 1.26B relative to inventory of 449.50M (2.81 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (793.80M) provides weak coverage of capital expenditures of 3.16B, with a -0.25 ratio suggesting additional external financing needs for growth initiatives.
  • Free cash flow of (793.80M) represents just -0.36x of debt issuance 2.20B, suggesting concerning reliance on leverage rather than internal cash generation for growth.

Segments Breakdown of Revenue (2023)

Segments Breakdown of Revenue (2023)

Peer comparison

Companies in the Utilities - Regulated Gas
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ATO Atmos Energy Corp 28.99 Bn 23.20 5.95 9.63 Bn
2 NI Nisource Inc. 14.62 Bn 27.48 3.16 16.21 Bn
3 UGI Ugi Corp /Pa/ 8.33 Bn 13.88 1.13 7.21 Bn
4 NJR New Jersey Resources Corp 5.43 Bn 16.61 2.52 3.97 Bn
5 BKH Black Hills Corp /Sd/ 5.38 Bn 18.44 2.33 4.70 Bn
6 SR Spire Inc 5.36 Bn 19.83 2.09 5.35 Bn
7 SWX Southwest Gas Holdings, Inc. 5.04 Bn 19.06 1.48 3.51 Bn
8 OGS ONE Gas, Inc. 4.50 Bn 29.67 3.07 3.40 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.64 0.79
EV to Cash from Ops. EV/CFO 16.03 18.36
EV to Debt EV to Debt 1.42 1.86
EV to EBIT EV/EBIT 22.68 -126.33
EV to EBITDA EV/EBITDA 19.72 11.96
EV to Free Cash Flow [EV/FCF] EV/FCF 99.43 -73.99
EV to Market Cap EV to Market Cap 1.58 1.71
EV to Revenue EV/Rev 4.98 3.19
Price to Book Value [P/B] P/B 2.48 2.59
Price to Earnings [P/E] P/E 27.48 77.08
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.75 1.42
Dividend Payout Ratio % Div Payout % (Qtr) 57.10 47.06
Dividend per Basic Share Div per Share (Qtr) 1.14 1.78
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) -67.90 54.25
Interest Coverage Int. cover (Qtr) 2.77 3.17
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -19.41 -16.87
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -31.67 44.73
Dividend Growth (1y) % Div 1y % (Qtr) 6.05 -0.03
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 22.30 6.88
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 20.18 113.90
EBIT Growth (1y) % EBIT 1y % (Qtr) 23.45 26.96
EBT Growth (1y) % EBT 1y % (Qtr) 23.39 12.44
EPS Growth (1y) % EPS 1y % (Qtr) 20.25 24.35
FCF Growth (1y) % FCF 1y % (Qtr) 7.86 -146.22
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 17.00 10.16
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.19 0.36
Cash Payout Ratio Cash Payout (Qtr) 0.10 0.12
Cash Ratio Cash Ratio (Qtr) 0.04 0.15
Current Ratio Curr Ratio (Qtr) 0.69 0.94
Debt to Equity Ratio Debt/Equity (Qtr) 1.72 3.58
Interest Cover Ratio Int Coverage (Qtr) 2.77 3.17
Times Interest Earned Times Interest Earned (Qtr) 2.77 3.17
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 44.30 32.74
EBIT Margin % EBIT Margin % (Qtr) 26.68 21.43
EBT Margin % EBT Margin % (Qtr) 17.06 13.06
Gross Margin % Gross Margin % (Qtr) 76.10 43.32
Net Profit Margin % Net Margin % (Qtr) 14.00 9.98