Alliant Energy Corporation
Analysis
Alliant's growth now rests on data centers: signed large-load contracts passed 3 gigawatts, and management raised expected demand growth to more than 60% by 2031. The catch is that the spending lands years before the sales. How does Alliant's current build compare with its last big spending cycle?
- Data centers went from a target to a signed backlog.
Contracted large load reached 3.4 gigawatts across five agreements, and expected demand growth by 2031 rose from 50% to over 60%. Three sites are under construction and Google has begun taking power, so the backlog is becoming sales. How much of Alliant's 2 to 4 gigawatt pipeline is expansions of existing sites?
- Rate base is growing almost twice as fast as earnings.
Alliant raised the capital plan to $13.4 billion while guiding earnings per share to grow 7% from 2027 through 2029. The gap is new shares and higher interest costs, so the business grows faster than the profit behind each share. How much of Alliant's growth is funded by selling new shares?
- The spending arrives years before the power does.
Capital spending nearly doubled since 2022 and free cash flow went negative, so the build is funded with debt and share sales. Most data center load arrives around 2030, so the next few years look worse than the business that follows.
- Contracted data center demandThe bull case is that signed hyperscale contracts turn a slow-growth utility into one whose demand rises faster than the underlying economy.
- Regulated capital investmentGrowth comes from regulated spending on generation, storage and wires, so earnings rise as the approved asset base grows rather than from market prices.
- Supportive state regulatorsIowa's rate framework and Wisconsin's settlement let the company earn its allowed return while holding base rates flat, which the bull side expects to continue.
- Load ramp timingThe bear case is that most of the contracted load arrives late in the decade, so sales growth stays close to the general economy for several more years.
- Local siting oppositionData centers need township zoning and local consent, and a contracted project already moved to another state, which the bear side expects to keep happening.
- Equity funding needsPaying for the build requires selling stock and borrowing, which spreads profit over more shares and leaves free cash flow negative while spending runs ahead.
| Politician | Transaction | Amount | Traded | Filed |
|---|---|---|---|---|
Donald Trump Republican · Executive | Purchase | ≥$15K | Jun 12 | Aug 22 |
Donald Trump Republican · Executive | Purchase | ≥$1K | Jan 23 | May 13 |
Lisa C. McClain Republican · House · MI-9 | Purchase | ≥$1K | Aug 4 | Sep 12 |
Lisa C. McClain Republican · House · MI-9 | Sale | ≥$1K | Aug 13 | Sep 12 |
Lois Frankel Democratic · House · FL-22 | Sale | ≥$1K | Sep 8 | Oct 10 |
Congressional trading data provided by QuiverQuant
How Alliant Energy turned $4.4B of revenue into $1.0B of operating income.
| Revenue | ||
|---|---|---|
| Electric | $3.7B | ▲ 9.64% YoY |
| Gas | $525.0M | ▲ 12.90% YoY |
| Other Utility | $51.0M | ▼ 5.56% YoY |
| Total revenue | $4.4B | |
| Gross profit | $3.7B | 85.7% |
| Operating income | $1.0B | 23.5% |