Earnings estimates for NiSource, Inc. (NI - Free Report) have been revised upward over the past 60 days, reflecting analyst’s confidence in the stock. The Zacks Consensus Estimate for 2018 earnings has moved 0.8% north to $1.29 per share.
Merrillville, IN-based NiSource Inc. is an energy holding company and together with its subsidiaries provides natural gas, electricity and other products and services in the United States. The company supplies energy to roughly 4 million customers in the Gulf Coast, Midwest and New England.
The stock has an impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors. Back tested results show that stocks with a favorable VGM Score of A or B coupled with a bullish Zacks Rank offer the best investment bets.
Let’s focus on the factors that make NiSource an attractive stock to hold on to for greater returns.
Price Appreciation: Shares of NiSource have gained 5.8% in a year’s time against the industry’s decline of 0.2%. The stock carries a Zacks Rank #2 (Buy).
Positive Earnings Surprise History: NiSource’s average four-quarter positive earnings surprise stands at 0.8%.
Capex Plan: The company will make a few planned utility infrastructure investments worth about $1.7-$1.8 billion in 2018 and the annual investment is expected to be in the range of $1.6-$1.8 billion through 2020. Also, the company has identified $30 billion worth long-term infrastructure investments. Of its planned $30-billion expenditure, the company will pump nearly $20 billion into strengthening its gas operations and $10 billion to boost its electricity undertakings.
In excess of 75% of capital expenditure, NiSource starts to provide a 12-month return on investment. The clear visibility of return from its ongoing investments will allow the company to deliver its targeted earnings and 5-7% dividend growth through 2020.
New Projects to Come Online: One of the company’s subsidiaries, NIPSCO, continues to execute on its seven-year $1.25 billion electric infrastructure modernization program, which includes enhancements of its electric transmission and distribution system designed to further improve system safety and reliability.
NIPSCO’s two major electric transmission projects — the 100-mile 345-kV and 65-mile 765-kV — are designed to upgrade its region-wide system flexibility and reliability and are expected to start service during the second half of 2018.
Other Stocks to Consider
Some other top-ranked stocks from the Zack Utility Sector are Ameren Corporation (AEE - Free Report) , Atmos Energy Corporation (ATO - Free Report) and Brook field Renewable Partners L.P. , each holding a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Ameren came up with an average four-quarter earnings surprise of 7.69%. The Zacks Consensus Estimate for 2018 EPS moved 0.3% up in the last 60 days to $3.04.
Atmos Energy delivered an average four-quarter beat of 8.76%. The consensus mark for 2018 bottom line has been revised 0.5% upward in the last 60 days to $3.99 per share.
Brookfield Renewable pulled off an average four-quarter positive surprise of 4.17%. The consensus estimate for 2018 EPS has been raised 57.1% in the last 60 days to 22 cents per share.
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