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NiSource (NI) Down 1.3% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for NiSource (NI - Free Report) . Shares have lost about 1.3% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is NiSource due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

NiSource Q1 Earnings Beat Estimates, Revenues Miss

NiSource reported first-quarter 2024 operating earnings per share (EPS) of 85 cents, which surpassed the Zacks Consensus Estimate of 81 cents by 4.9%. The bottom line increased 10.4% from the year-ago quarter’s recorded figure of 77 cents.

On a GAAP basis, the company reported an EPS of 77 cents compared with 71 cents in the prior-year quarter.

Total Revenues

Operating revenues of $1.71 billion missed the Zacks Consensus Estimate of $2.07 billion by 17.5%. The top line also decreased 13.2% from the prior-year quarter’s figure of $1.97 billion.

Highlights of the Release

Total operating expenses amounted to $1.12 billion, down 22.2% from the year-ago quarter’s level of $1.44 billion due to lower energy.

Operating income totaled $583.4 million, up 9.9% from the year-ago figure of $531 million.

Net interest expenses amounted to $116.3 million, up 6.8% from the prior-year quarter’s $108.9 million.

Total gas distribution in Sales and Transportation was recorded at 207.3 Million British Thermal Units per day (MMDth), up 6.7% from the prior-year quarter’s 194.3 MMDth.

Total electric sales were recorded at 3,648.9 gigawatt-hours (GWh), up 1.8% from the prior-year quarter’s 3,582.8 GWh.

Financial Update

NiSource's cash and cash equivalents as of Mar 31, 2024 were $0.102 billion compared with $2.24 billion as of Dec 31, 2023.

Long-term debts (excluding those due within a year) as of Mar 31, 2024 were $11.72 billion compared with $11.05 billion as of Dec 31, 2023.

Net cash flows from operating activities in the first three months of 2024 were $456.2 million compared with $683.4 million in the year-ago period.

Guidance

The company expects 2024 non-GAAP earnings in the band of $1.70-1.74 per share. The Zacks Consensus Estimate is pegged at $1.71 per share, which is lower than the midpoint of the company’s guided range.

NI expects to witness an earnings CAGR of 6-8% through 2028. It has increased its capital expenditure plan for the 2024-2028 period to $16.4 billion from the previous projection of $16 billion.

 

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -18.18% due to these changes.

VGM Scores

At this time, NiSource has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, NiSource has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

NiSource belongs to the Zacks Utility - Electric Power industry. Another stock from the same industry, CenterPoint Energy (CNP - Free Report) , has gained 1.5% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.

CenterPoint reported revenues of $2.62 billion in the last reported quarter, representing a year-over-year change of -5.7%. EPS of $0.55 for the same period compares with $0.50 a year ago.

CenterPoint is expected to post earnings of $0.35 per share for the current quarter, representing a year-over-year change of +25%. Over the last 30 days, the Zacks Consensus Estimate has changed +3%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for CenterPoint. Also, the stock has a VGM Score of B.


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