NiSource Inc
Analysis
NiSource spent the past year turning data center demand into signed, contracted growth and raised its long-term earnings target to 9% to 10% a year. The tension is timing: the plants get built and paid for years before the customers pay.How much of NiSource's data center spending comes back as profit by 2030?
- Data centers turned from a sales pitch into signed contracts.
Indiana approved GenCo, the arm that owns plants built for big customers. Amazon and Alphabet have both signed, and Amazon has expanded since; management raised its growth target twice, now 9% to 10% a year.Which NiSource data center contracts still lack a final Indiana order?
- The build is being paid for with borrowed money and new shares.
Capital spending runs far ahead of the cash the utilities produce, and total debt has passed $16 billion. Free cash flow was negative in Q2 FY2026, and NiSource plans to sell new stock because the plants only start paying once they run.How much does NiSource's debt climb before the new plants start earning?
- The regulator who has to approve all of it is getting tougher.
In Q2 FY2026 Indiana's commission declined NIPSCO's gas-cost tracker, the shortcut that skips a rate case, and earnings fell year over year on storm and union costs. Every data center contract still needs that same state's approval.
- Data center load growthThe bull case is that Indiana data center demand lets NiSource invest far more capital than its regulated gas and electric business alone would support.
- Contracted GenCo returnsThe contracts are built to earn more than the regulated return while shielding retail customers from the cost, which keeps regulators and state officials supportive.
- Rebasing guidance each yearManagement raises its long-term guidance each year it beats and now points to signed contracts plus a further pipeline as the base for that growth.
- Indiana cost recovery riskThe bear case is that Indiana regulators are tightening cost recovery as customer bills rise, which could slow or shrink the capital program the growth plan depends on.
- Customer concentrationOne data center customer will take generation roughly equal to the whole existing NIPSCO fleet and can walk away on notice, concentrating risk in one counterparty.
- Funding the capital planThe plan spends more than internally generated cash, so debt and share issuance rise and per-share growth depends on new assets earning returns on schedule.
| Politician | Transaction | Amount | Traded | Filed |
|---|---|---|---|---|
Donald Trump Republican · Executive | Sale | ≥$1K | Jun 12 | Aug 22 |
Donald Trump Republican · Executive | Purchase | ≥$1K | May 11 | Jul 1 |
Donald Trump Republican · Executive | Purchase | ≥$15K | Mar 12 | May 13 |
Donald Trump Republican · Executive | Purchase | ≥$1K | Mar 4 | May 13 |
Ro Khanna Democratic · House · CA-17 | Purchase | ≥$1K | Jul 9 | Aug 7 |
Congressional trading data provided by QuiverQuant
How NiSource Inc turned $5.3B of revenue into $1.3B of operating income.
| Revenue | ||
|---|---|---|
| Gas Distribution Operations | $3.7B | ▼ 7.14% YoY |
| Electric Operations | $1.8B | ▼ 2.55% YoY |
| Total revenue | $5.3B | |
| Gross profit | $3.8B | 71.3% |
| Operating income | $1.3B | 24.2% |