NISOURCE INC (NI) Stock Fundamental Analysis
NYSE:NI - New York Stock Exchange, Inc. - US65473P1057 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to NI. NI was compared to 25 industry peers in the Multi-Utilities industry. While NI has a great profitability rating, there are quite some concerns on its financial health. NI is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
NI had positive earnings in the past year.
NI had a positive operating cash flow in the past year.
NI had positive earnings in 4 of the past 5 years.
NI had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.62%, NI is doing worse than 68.00% of the companies in the same industry.
The Return On Equity of NI (9.76%) is comparable to the rest of the industry.
Looking at the Return On Invested Capital, with a value of 4.63%, NI belongs to the top of the industry, outperforming 96.00% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NI is in line with the industry average of 3.93%.
The 3 year average ROIC (4.05%) for NI is below the current ROIC(4.63%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.62% | ||
| ROE | 9.76% | ||
| ROIC | 4.63% |
ROA(3y)2.42%
ROA(5y)1.82%
ROE(3y)8.79%
ROE(5y)6.55%
ROIC(3y)4.05%
ROIC(5y)4%
1.3 Margins
NI has a better Profit Margin (14.63%) than 72.00% of its industry peers.
NI's Profit Margin has improved in the last couple of years.
NI's Operating Margin of 27.66% is amongst the best of the industry. NI outperforms 96.00% of its industry peers.
NI's Operating Margin has been stable in the last couple of years.
NI's Gross Margin of 77.16% is amongst the best of the industry. NI outperforms 84.00% of its industry peers.
NI's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.66% | ||
| PM (TTM) | 14.63% | ||
| GM | 77.16% |
OM growth 3Y9.04%
OM growth 5Y1.39%
PM growth 3Y7.76%
PM growth 5Y16.53%
GM growth 3Y3.45%
GM growth 5Y2.36%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NI is destroying value.
Compared to 1 year ago, NI has more shares outstanding
NI has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, NI has an improved debt to assets ratio.
2.2 Solvency
NI has an Altman-Z score of 0.74. This is a bad value and indicates that NI is not financially healthy and even has some risk of bankruptcy.
NI has a Altman-Z score (0.74) which is in line with its industry peers.
A Debt/Equity ratio of 1.53 is on the high side and indicates that NI has dependencies on debt financing.
With a Debt to Equity ratio value of 1.53, NI perfoms like the industry average, outperforming 52.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.53 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 0.74 |
ROIC/WACC0.72
WACC6.44%
2.3 Liquidity
NI has a Current Ratio of 0.52. This is a bad value and indicates that NI is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.52, NI is not doing good in the industry: 92.00% of the companies in the same industry are doing better.
A Quick Ratio of 0.45 indicates that NI may have some problems paying its short term obligations.
NI's Quick ratio of 0.45 is on the low side compared to the rest of the industry. NI is outperformed by 92.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.90% over the past year.
The Earnings Per Share has been growing slightly by 5.80% on average over the past years.
The Revenue has grown by 13.08% in the past year. This is quite good.
The Revenue has been growing slightly by 0.93% on average over the past years.
EPS 1Y (TTM)11.9%
EPS 3Y7.72%
EPS 5Y5.8%
EPS Q2Q%15.29%
Revenue 1Y (TTM)13.08%
Revenue growth 3Y3.64%
Revenue growth 5Y0.93%
Sales Q2Q%27.95%
3.2 Future
Based on estimates for the next years, NI will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.40% on average per year.
The Revenue is expected to grow by 5.22% on average over the next years.
EPS Next Y10.38%
EPS Next 2Y8.78%
EPS Next 3Y8.57%
EPS Next 5Y8.4%
Revenue Next Year0.31%
Revenue Next 2Y2.78%
Revenue Next 3Y3.68%
Revenue Next 5Y5.22%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 22.29, the valuation of NI can be described as rather expensive.
80.00% of the companies in the same industry are cheaper than NI, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of NI to the average of the S&P500 Index (27.35), we can say NI is valued inline with the index average.
NI is valuated rather expensively with a Price/Forward Earnings ratio of 20.23.
Based on the Price/Forward Earnings ratio, NI is valued more expensive than 88.00% of the companies in the same industry.
NI is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 37.54, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.29 | ||
| Fwd PE | 20.23 |
4.2 Price Multiples
60.00% of the companies in the same industry are cheaper than NI, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.43 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NI does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of NI may justify a higher PE ratio.
PEG (NY)2.15
PEG (5Y)3.84
EPS Next 2Y8.78%
EPS Next 3Y8.57%
5. Dividend
5.1 Amount
NI has a Yearly Dividend Yield of 2.78%.
With a Dividend Yield of 2.78, NI pays less dividend than the industry average, which is at 3.73. 92.00% of the companies listed in the same industry pay a better dividend than NI!
NI's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.78% |
5.2 History
The dividend of NI has a limited annual growth rate of 2.55%.
NI has been paying a dividend for at least 10 years, so it has a reliable track record.
NI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)2.55%
Div Incr Years13
Div Non Decr Years20
5.3 Sustainability
56.96% of the earnings are spent on dividend by NI. This is a bit on the high side, but may be sustainable.
The dividend of NI is growing, but earnings are growing more, so the dividend growth is sustainable.
DP56.96%
EPS Next 2Y8.78%
EPS Next 3Y8.57%
41.9
+0.21 (+0.5%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryMulti-Utilities
Earnings (Last)
Earnings (Next)
Inst Owners97.22%
Inst Owner Change0.11%
Ins Owners0.25%
Ins Owner Change5.83%
Market Cap19.72B
Analysts84.17
Price Target44.89 (7.14%)
Short Float %2.7%
Short Ratio2.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.78% |
Yearly Dividend1.07
Dividend Growth(5Y)2.55%
DP56.96%
Div Incr Years13
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2.45%
Min EPS beat(2)-1.04%
Max EPS beat(2)5.94%
EPS beat(4)3
Avg EPS beat(4)12.6%
Min EPS beat(4)-1.04%
Max EPS beat(4)22.96%
EPS beat(8)6
Avg EPS beat(8)7.93%
EPS beat(12)7
Avg EPS beat(12)3.73%
EPS beat(16)9
Avg EPS beat(16)3.47%
Revenue beat(2)1
Avg Revenue beat(2)0.52%
Min Revenue beat(2)-7.74%
Max Revenue beat(2)8.78%
Revenue beat(4)1
Avg Revenue beat(4)-2.28%
Min Revenue beat(4)-9.33%
Max Revenue beat(4)8.78%
Revenue beat(8)1
Avg Revenue beat(8)-9.33%
Revenue beat(12)5
Avg Revenue beat(12)-3.5%
Revenue beat(16)6
Avg Revenue beat(16)-3.22%
PT rev (1m)1.43%
PT rev (3m)4.97%
EPS NQ rev (1m)2.4%
EPS NQ rev (3m)-0.4%
EPS NY rev (1m)0.07%
EPS NY rev (3m)0.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.35%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.29 | ||
| Fwd PE | 20.23 | ||
| P/S | 3.32 | ||
| P/FCF | N/A | ||
| P/OCF | 9.8 | ||
| P/B | 2.22 | ||
| P/tB | 2.66 | ||
| EV/EBITDA | 12.43 |
EPS(TTM)1.88
EY4.49%
EPS(NY)2.07
Fwd EY4.94%
FCF(TTM)-1.74
FCFYN/A
OCF(TTM)4.27
OCFY10.2%
SpS12.6
BVpS18.9
TBVpS15.74
PEG (NY)2.15
PEG (5Y)3.84
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.62% | ||
| ROE | 9.76% | ||
| ROCE | 5.68% | ||
| ROIC | 4.63% | ||
| ROICexc | 4.67% | ||
| ROICexgc | 4.92% | ||
| OM | 27.66% | ||
| PM (TTM) | 14.63% | ||
| GM | 77.16% | ||
| FCFM | N/A |
ROA(3y)2.42%
ROA(5y)1.82%
ROE(3y)8.79%
ROE(5y)6.55%
ROIC(3y)4.05%
ROIC(5y)4%
ROICexc(3y)4.17%
ROICexc(5y)4.07%
ROICexgc(3y)4.42%
ROICexgc(5y)4.34%
ROCE(3y)5.19%
ROCE(5y)5.04%
ROICexcg growth 3Y3.4%
ROICexcg growth 5Y-4.29%
ROICexc growth 3Y3.95%
ROICexc growth 5Y-3.9%
OM growth 3Y9.04%
OM growth 5Y1.39%
PM growth 3Y7.76%
PM growth 5Y16.53%
GM growth 3Y3.45%
GM growth 5Y2.36%
F-Score6
Asset Turnover0.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.53 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 5.04 | ||
| Cap/Depr | 266.93% | ||
| Cap/Sales | 47.68% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.49% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.52 | ||
| Quick Ratio | 0.45 | ||
| Altman-Z | 0.74 |
F-Score6
WACC6.44%
ROIC/WACC0.72
Cap/Depr(3y)287.5%
Cap/Depr(5y)277.1%
Cap/Sales(3y)47.4%
Cap/Sales(5y)44.54%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)11.9%
EPS 3Y7.72%
EPS 5Y5.8%
EPS Q2Q%15.29%
EPS Next Y10.38%
EPS Next 2Y8.78%
EPS Next 3Y8.57%
EPS Next 5Y8.4%
Revenue 1Y (TTM)13.08%
Revenue growth 3Y3.64%
Revenue growth 5Y0.93%
Sales Q2Q%27.95%
Revenue Next Year0.31%
Revenue Next 2Y2.78%
Revenue Next 3Y3.68%
Revenue Next 5Y5.22%
EBIT growth 1Y21.47%
EBIT growth 3Y13.01%
EBIT growth 5Y2.33%
EBIT Next Year85.13%
EBIT Next 3Y30.96%
EBIT Next 5Y22.38%
FCF growth 1Y13.9%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y32.96%
OCF growth 3Y13.52%
OCF growth 5Y2.39%