NiSource Inc. (NYSE: NI) — The Best-Located Data-Center Utility, Now Priced Like Everyone Already Knows It

Independent Equity Research Date: July 4, 2026 · Sector: Utilities · Regulated Gas & Electric (Multi-Utility) Price at analysis: ~$47.82 (Jul 2, 2026) · Market cap: ~$22.8B · Enterprise value: ~$41B · Shares out: ~478M

⚡ Claude’s Take

This block is the author’s own independent opinion and general information only — not investment advice. The analysis that follows (sections 1–15) takes no position and carries no price target; the single exception is this block.

Verdict: HOLD / accumulate-on-weakness. A genuinely improved utility fully paid for at the tape. Not a short. Preferred entry zone ~$40–44 (~18–20× forward adjusted EPS), vs. ~$47.82 today (~23× the FY26 guide midpoint).

NiSource is the real thing in the one place it matters. Its NIPSCO subsidiary sits on the Northern Indiana ground hyperscalers most want — abutting the Chicago load pocket, wrapped in a redundant 345-kV transmission backbone, with gas supply and cheap land — and management has wrapped that geography in the cleverest regulatory wrapper in the group. The “Genco” model lets NIPSCO serve Amazon and Alphabet through ring-fenced bilateral contracts that (a) isolate large-load cost and construction risk from the 3.3M retail customers, (b) hand those retail customers ~$1.4B of bill savings ($124/yr each) to keep regulators and politicians onside, and © still earn NiSource a risk-adjusted return on ~800 MW (scaling to a 9-GW pipeline). That is how a plain gas-and-electric utility legitimately raised its 2023–2033 adjusted-EPS CAGR to 9–10% on 9–11% rate-base growth — top-quartile for the sector — while insisting on 14–16% FFO/debt. The business is better than it was five years ago, and the improvement is not a story; it is in signed contracts and a reaffirmed guide.

The problem is that the market has already graded the exam and given it an A. NI trades at its richest-ever price-to-book (99th percentile of its own 10-year history) and price-to-sales (99th percentile), and ~23× forward adjusted EPS — a premium to WEC, AEE, CMS and DTE despite carrying more balance-sheet leverage (89% debt/cap), a chunky NIPSCO minority interest sold to Blackstone, an ROIC that still only rounds to its cost of capital (~6%), and ~18% share dilution over four years to fund a persistently FCF-negative build. You are paying a growth multiple for a regulated return stream whose upside is largely contracted and disclosed. The framing is quality-compounder-at-a-full-price / crowded-momentum, not value: the stock is a low-beta (~0.4) one-way street up, roughly doubled off its 2023 lows and 2.6% off an all-time high, with a +25% one-year run. There is nothing to be short here — the earnings power is real and rising — but there is also little margin of safety, and utilities that have priced in a decade of above-average growth punish the first quarter that misses. Conviction: medium. Flips bullish if the 3-GW “strategic negotiations” bucket converts to signed, NIPSCO-owned generation that pushes the CAGR through 10% with FFO/debt intact. Flips bearish if Indiana/Pennsylvania regulators or politicians sour on data-center cost allocation, if a discrete NIPSCO generation cost-overrun appears, or if the equity-funding cadence has to step up and the ATM starts eating the growth per share. Tag: “The best house on the block, sold at the block’s highest-ever price.”

📈 Stock Price Action — Five-Year Event Map

Factual price history — not a recommendation and not a price target. Price moves are FACT; attributed drivers are INTERPRETATION.

NiSource round-tripped from a COVID-crash low of ~$20.86 (Mar 2020) to an all-time high of ~$49.08 (Jun 26, 2026), and trades at ~$47.82 today — only ~2.6% off that high, near the top of a 52-week range of ~$39.00–$49.08. The story is two distinct regimes: four years of range-bound “dead money” (~$23–32, 2020–2023) as the company digested the Massachusetts exit and a rising-rate headwind, followed by a powerful ~2× re-rating from late-2023 lows once the data-center/rate-base growth narrative took hold.

Cycle narrative. (1)–(2) The pandemic low coincided with NiSource shrinking — it sold Columbia Gas of Massachusetts to Eversource in 2020 to exit the state after the 2018 Greater Lawrence over-pressurization disaster, resetting the earnings base. (3) Through 2022–2023 NI behaved like a classic bond-proxy: as the 10-year yield rose, the stock went nowhere despite a steadily growing rate base, and Blackstone Infrastructure’s purchase of ~19.9% of NIPSCO (agreed mid-2023, closed December 2023 for $2.16B) brought in minority capital to help fund the build. CEO Lloyd Yates made a ~$1.06M open-market purchase at ~$26 in August 2023, near the lows. (4) From late 2023 the market re-rated regulated utilities with credible load-growth stories; NiSource, sitting on prime Indiana data-center real estate, was a prime beneficiary, running ~60% into November 2024. (5)–(6) Through 2025 and into 2026 the Genco model turned the narrative into signed contracts — Amazon and Alphabet, ~800 MW secured with a ~9-GW pipeline, IURC approval landing in June 2026 — and management raised the long-term EPS CAGR by 100 bps, driving the stock to fresh all-time highs. Each up-leg is a fact; the data-center attribution is interpretation, but it is corroborated by the timing of the contract 8-Ks and the guidance revisions.

1. Executive Summary

NiSource is a $22.8B-market-cap regulated energy holding company operating two segments across six states: Gas Distribution (Columbia Gas LDCs serving ~3.3M customers in Ohio, Pennsylvania, Virginia, Kentucky and Maryland, plus NIPSCO gas in Indiana) and Electric Operations (NIPSCO, ~0.5M electric customers in Northern Indiana). It is a pure-play regulated utility — no meaningful competitive-market generation, no unregulated retail — which is the highest-quality structural profile in the power sector: revenues are set by regulators to recover cost of service plus an allowed return on a growing rate base.

The investment tension is simple: a good, improving business at a great-story price. The bull case is that NiSource has converted an ordinary gas-and-electric footprint into a differentiated growth vehicle. NIPSCO’s Northern Indiana territory is arguably the single best-located utility service area in the country for hyperscale data centers, and management’s “Genco” model — ring-fenced generation serving large loads via bilateral contracts, with savings shared back to retail customers — lets NiSource capture that demand while insulating existing ratepayers and the balance sheet. The result is a 9–10% adjusted-EPS CAGR through 2033 on 9–11% rate-base growth, a top-quartile trajectory funded by a ~$28.6B five-year capital plan ($21B base + ~$7.6B Genco/data-center).

The bear case is valuation and financialization. NI trades at its richest-ever price-to-book and price-to-sales (both ~99th percentile of a decade of history) and ~23× forward adjusted EPS — a premium to peers that carry less leverage. Its ROIC (~5.8%) still only rounds to its cost of capital; GAAP profitability is unremarkable; the business is structurally FCF-negative (FY25 capex ~$4.5B vs. OCF ~$2.4B), funding the gap with ~$16.2B of debt (89% debt/cap), a ~$2.2B NIPSCO minority interest sold to Blackstone, and ~18% share dilution over four years. The growth is real, but so is the price you pay for it, and the disclosed pipeline leaves limited room for positive surprise.

Verdicts in brief: industry — structurally attractive (regulated, constructive jurisdictions, secular load tailwind); competitive position — a narrow, location-and-regulatory-construct advantage at NIPSCO, weaker in the commoditized gas LDCs; growth — high-quality and contracted, but fully disclosed; financial quality — utility-typical (returns ≈ cost of capital, heavy leverage, negative FCF by design); capital allocation — competent and disciplined, if dilutive; valuation — priced for the plan to work, with the multiple, not the earnings, carrying the risk.

2. Business Overview

NiSource Inc. is an energy holding company headquartered in Merrillville, Indiana, whose operating subsidiaries are all rate-regulated utilities. Effective January 1, 2024 the company recast its reporting into two geographic/operating segments — Columbia Operations and NIPSCO Operations — which map cleanly onto its two economic engines:

Columbia Operations — the gas LDC (FY25 operating income ~$895M; ~$1.2B capex; ~$15.9B assets). NiSource distributes natural gas to approximately 3.3 million customers through roughly 55,000 miles of distribution main and 1,000 miles of transmission main, under the Columbia Gas brand in Ohio, Pennsylvania, Virginia, Kentucky and Maryland (NIPSCO also runs gas in Indiana, reported under NIPSCO). Columbia Gas of Ohio is the largest single gas jurisdiction. The gas LDC business is a pure delivery utility: NiSource earns a regulated return on the pipe-and-meter network and passes the commodity cost of gas through to customers without markup, so it is insulated from gas-price volatility — a rising or falling Henry Hub price flows through to customer bills, not to NiSource’s margin. Revenue is seasonal (winter-heating weighted) and increasingly weather-normalized through decoupling and fixed-charge mechanisms. This is the steadier, lower-growth half — a pipe-replacement rate-base grower recovered largely through riders (VA SAVE, PA DSIC, Ohio CEP).

NIPSCO Operations — the electric-plus-gas growth engine (FY25 operating income ~$938M; ~$2.5B capex; ~$18.1B assets). Through Northern Indiana Public Service Company (NIPSCO), NiSource generates, transmits and distributes electricity to approximately 0.5 million customers across roughly 20 counties in Northern Indiana (plus gas in the state), and participates in the MISO wholesale market. NIPSCO is in the middle of a generation transformation — retiring coal (Schahfer, Michigan City) and replacing it with wind, solar, battery storage and gas — and is the locus of the data-center growth story via the GenCo (“NIPSCO Generation Company”) structure. The two segments produce roughly equal operating income, but NIPSCO absorbs about twice the capital — the clearest single sign that the company’s growth, and its rate base, are tilting decisively toward the Indiana electric/generation/data-center build.

How it makes money. Like every regulated utility, NiSource earns revenue equal to its cost of service plus an allowed return on rate base. Rate base is the depreciated value of the utility plant regulators permit the company to recover — pipes, wires, substations, generation. The core economic engine is therefore rate-base growth × allowed return, converted to EPS after financing costs, with capital recovery accelerated where jurisdictions allow riders/trackers (which reduce “regulatory lag,” the gap between spending capital and earning on it). NiSource’s guided 9–11% rate-base CAGR is the fundamental driver of the 9–10% EPS CAGR. Recurring vs. non-recurring: essentially 100% of revenue is recurring, regulated delivery revenue; there is no cyclical merchant generation, no commodity trading book of consequence, and no material unregulated business. This is what makes utility revenue among the most predictable in the market — and why the entire investment debate reduces to (a) how fast the rate base grows, (b) what return regulators allow on it, and © what multiple the market pays for that stream.

3. Industry Dynamics

(Enriched with regulatory findings from the Industry workstream.)

Structure. Regulated electric and gas distribution is a legal, franchised monopoly business. In each service territory NiSource is the sole distributor; customers cannot buy delivery from a competitor. Barriers to entry are essentially absolute — no rational actor builds a duplicate gas or electric distribution network — and the “competition” is not another utility but the regulator, who sets allowed returns in exchange for the monopoly. This is the textbook Greenwald setup: a genuine barrier to entry (regulatory franchise + prohibitive replication cost) that produces stable market share, paired with a regulatory cap on the return that barrier can earn. The profit pool is therefore wide but administratively bounded — durable, low-volatility, but rarely spectacular.

Profit pool and returns. Allowed ROEs across NiSource’s jurisdictions are middling, not premium: Columbia PA 10.00% (effective Jan 2026), NIPSCO gas and electric 9.75% (2024/2025), Columbia KY/VA 9.75%, Columbia MD 9.80%, and Columbia OH just 9.60% (a stale March-2023 case). This is the single most important framing for the stock: NiSource is a rate-base-volume story, not a premium-ROE story — the earnings growth comes from investing more capital at an ordinary allowed return, not from earning an above-average return on that capital. Because utilities finance rate base with ~50%+ debt, the consolidated ROIC that results is lower still (NiSource’s ~5.8%) — a structural feature of the model, not a NiSource failing. The key variable that separates good utility jurisdictions from bad ones is regulatory lag and mechanism quality: forward test years, decoupling, and capital trackers let a utility earn close to its allowed return in real time; historical test years and frequent litigated rate cases erode it. On this axis NiSource’s mix is constructive but uneven — Indiana is the best (a full TDSIC tracker suite with 80% current recovery, CPCN pre-approval, and the IURC-blessed GenCo ring-fence); Virginia, Kentucky and Maryland are small but constructive; Ohio is the weak link (low 9.60% ROE, stale case), which the pending Senate Bill 103 — adding a forward test year and large-load contracts — would materially upgrade; and Pennsylvania is the emerging risk (see below).

The secular tailwind — and its asymmetry. The industry’s structural story has flipped from stagnant to growing. After two decades of flat-to-declining electricity demand (efficiency offsetting economic growth), data-center and electrification load has produced the first genuine demand-growth cycle in a generation. This is unambiguously good for rate-base growth — utilities get to invest more capital and earn on it. Through a Marathon capital-cycle lens, however, it warrants caution: high returns and a visible demand wave are attracting enormous capital across the entire utility complex, and history says capital floods to where returns are high until they mean-revert. The regulated model damps this (returns are administratively set, not competed away), but the risk migrates to the regulatory and political layer: if data-center growth pushes retail bills up, or if allowed returns look generous against a backdrop of affordability stress, regulators claw back. This is not hypothetical — in April 2026 Pennsylvania Governor Shapiro wrote to 24 utilities threatening to oppose “unacceptably high” rate increases and floated profit caps, a direct shot across the bow for Columbia Gas of PA and a preview of the affordability politics that a load-growth cycle invites. NiSource’s GenCo design — sharing ~$1.4B of savings with retail customers — is a direct, sophisticated attempt to inoculate against exactly this backlash.

Gas-LDC secular risk. The bear’s structural worry is decarbonization: building electrification, gas bans in some jurisdictions, and long-run pressure on the gas-distribution franchise. This is real but slow, and largely a coastal/California phenomenon; in NiSource’s Midwest/Mid-Atlantic footprint, gas remains the low-cost heating fuel and the political environment is supportive. The nearer risk to the gas LDCs is simply that they are the lower-growth, more commoditized half of the company — steady 4–6% rate-base growth pipe-replacement businesses that anchor the multiple while NIPSCO electric supplies the excitement.

Verdict: structurally attractive. Monopoly franchises, constructive regulation, and a genuine multi-year load tailwind. The qualifier is that “attractive industry” does not mean “attractive at any price,” and the tailwind is now widely understood and being capitalized by the whole sector.

4. Competitive Position

The right question for a regulated utility is not “does it have a moat?” — the franchise is the moat, and every regulated utility has one. The right question is whether NiSource’s franchises are better-located, better-regulated, and better-managed than peers’, because that is what determines relative rate-base growth and relative multiple.

The location advantage (real, narrow, and the crux of the thesis). NIPSCO’s Northern Indiana territory is a genuinely differentiated asset. It offers hyperscalers what they most need and cannot easily get elsewhere: proximity to the Chicago load and fiber pocket, a redundant 345-kV transmission backbone, abundant gas supply, available industrial land, and a speed-to-power advantage that management repeatedly emphasizes (“time-to-power availability, which is hard to find and people pay for”). This is a location moat, not a technology or brand moat — but for data centers, location and speed-to-power are the scarce resources. NiSource has signed ~4 GW and lines up a ~9-GW pipeline against it. The advantage is narrow (it is specific to NIPSCO’s electric territory; the gas LDCs have no such edge) and contestable at the margin (neighboring utilities — AEP’s Indiana Michigan Power, Duke Energy Indiana, and the broader PJM/MISO Midwest — are chasing the same hyperscalers), but NiSource’s early contracts and the Genco construct give it a first-mover, ring-fenced position.

The regulatory-construct advantage (the genuinely clever part). The Genco model is the closest thing to intellectual property a utility can own. By serving large loads through special bilateral contracts — with minimum demand charges, long-term commitments, credit support, and construction/market-risk allocation to the counterparty — NiSource earns a risk-adjusted return outside the traditional return-on-rate-base mechanism, ring-fencing the cost and risk of hyperscaler generation from its 3.3M retail customers. Crucially, it hands retail customers ~$1.4B of savings ($124/yr each), which converts a potential affordability/political liability into a stakeholder win and greases regulatory approval (IURC clearance arrived June 2026; new contracts get an expedited 90–120-day review). This is a defensible, replicable-only-with-difficulty regulatory innovation — and it is why NiSource, rather than a neighbor, is capturing the marquee Amazon and Alphabet deals.

Where the moat is thin. The gas distribution business is commoditized delivery — a good business, but not a differentiated one; Columbia Gas of Ohio earns what PUCO allows, no more. And the location/Genco advantage, while real, is not permanent: it depends on continued Indiana political support, on transmission headroom that finite build-out will consume, and on hyperscaler demand that is itself cyclical and concentrated in a handful of counterparties (Amazon, Alphabet, and a short list of others). If the AI-capex cycle cools, the pipeline that justifies today’s premium multiple thins.

Verdict: a narrow but real advantage at NIPSCO — location plus the Genco regulatory construct — bolted onto an otherwise average, commoditized multi-state gas LDC. It is enough to justify NiSource earning a premium growth rate; whether it justifies a premium multiple on top of that growth is the valuation question.

5. Growth History and Forward Opportunities

History. NiSource’s revenue and EPS history is that of a mid-single-digit rate-base grower that spent 2018–2020 shrinking and de-risking (the Massachusetts exit) before re-accelerating. Revenue moved from ~$4.68B (2020) to ~$6.64B (2025); the cleaner metric, adjusted EPS, has compounded at roughly a mid-single-to-high-single-digit rate as the rate base grew and share count rose. GAAP diluted EPS ran $1.35 (2021) → $1.69 (2022) → $1.50 (2023) → $1.65 (2024) → $1.97 (2025), noisy with one-time items; the company guides and is judged on non-GAAP adjusted EPS (~$1.85 in 2025), which is the smoother, rate-base-linked number.

The forward algorithm. Management’s plan is unusually explicit for a utility:

• Rate-base growth of 9–11%, driving
• Adjusted-EPS CAGR of 9–10% (2023–2033), raised 100 bps in Q1 2026 and tracking the high end through 2030;
• funded by a ~$28.6B five-year capital plan: $21B “base” (gas modernization, electric T&D, generation transition) + ~$2B upside + ~$7.6B Genco/data-center;
• with Genco-specific EPS of $0.25–0.35 (2030) and $0.40–0.60 (2033) layered on top.

Organic vs. contracted. Almost all of this is organic and, increasingly, contracted. The base plan is ordinary utility capital — pipe replacement, grid hardening, the coal-to-clean generation transition — that grows the rate base at a steady 6-ish% and is highly reliable. The incremental growth is the data-center layer, and the important nuance is that management’s 9–10% CAGR includes only signed contracts (Amazon + Alphabet, ~800 MW / ~4 GW total), not the ~3 GW in “strategic negotiations” or the ~2 GW “developing.” That is genuine upside optionality on top of a guide that is already top-quartile — but it is optionality the market is plainly already pricing.

Quality of growth. This is high-quality growth by utility standards: it is regulated (predictable), constructive-jurisdiction-based (low lag), and — in the Genco case — risk-mitigated (ring-fenced, contracted floors, counterparty credit support). The single most important quality caveat is that a meaningful slice is being funded with equity ($400–600M/yr of ATM issuance), so per-share growth is net of dilution — the reason to watch the adjusted-EPS CAGR, not the rate-base CAGR, as the true shareholder outcome.

Verdict: high-quality, well-articulated, largely contracted growth — the best growth profile in the multi-utility peer set — but fully disclosed and fully embedded in the price.

6. Financial Quality

Revenue and margins. FY25 revenue was $6,642M, up 22% on FY24 ($5,455M), though a chunk of the swing is gas-commodity pass-through (which inflates both revenue and cost of goods with no margin effect), so revenue growth overstates the underlying trajectory. The more meaningful margins: gross margin ~50%, EBITDA margin ~45%, operating margin ~28% in FY25 — healthy and stable, reflecting the regulated-delivery model. Net income to common was $929.5M (GAAP diluted EPS $1.97); adjusted EPS ~$1.85.

Returns on capital — the honest number. NiSource’s ROIC is ~5.8% (FY25), up from ~5.0% (FY24) — i.e., it rounds to the company’s cost of capital. ROE on ~$9.45B of common equity is ~10%, consistent with allowed returns. This is not a knock on management; it is the arithmetic of the regulated model, where the allowed equity return (~9.5–10%) is levered down at the enterprise level by ~50%+ debt. But it is the central fact a buyer of the stock must internalize: NiSource does not create meaningful economic value above its cost of capital; it grows a return stream that roughly equals its cost of capital, and shareholder value comes from growing the rate base and from the market’s willingness to pay a premium multiple for that growth. The Genco layer is the one place NiSource is explicitly trying to earn an above-rate-base, risk-adjusted return — a genuine, if small, value-creation lever.

Cash flow — negative by design. This is the defining financial characteristic of a growth utility and it must be understood, not feared: NiSource’s operating cash flow (~$2.36B FY25) is well short of its capex (~$4.5B), so it is structurally free-cash-flow negative and will remain so throughout the plan. The gap is bridged with external capital — net new debt (~$2.2B in FY25) and ATM equity ($400–600M/yr). This is normal and rational if and only if the capital earns its allowed return; it becomes dangerous if rate-base additions are disallowed, if financing costs outrun allowed ROEs, or if the equity has to be issued at a depressed price. The quality-of-earnings cross-check is reassuring on one axis (operating cash flow consistently exceeds net income, ~2.5× in FY25, as expected for a heavy-depreciation utility) and demanding on another (the business cannot self-fund and depends continuously on capital-market access).

Balance sheet. NiSource carries ~$16.2B of debt against ~$11.7B total equity (of which ~$2.2B is the NIPSCO minority interest held by Blackstone), for a total-debt-to-cap of ~89% and net-debt/EBITDA of ~5.4× — high in absolute terms but ordinary for a regulated utility, where stable cash flows support heavy leverage. Management targets FFO/debt of 14–16% in all plan years, the credit-rating guardrail (investment-grade, broadly BBB+/Baa1 area). Liquidity is adequate via revolver and commercial paper; the key balance-sheet risk is not default but rating pressure if the capital plan outruns FFO, which would raise the cost of the very debt that funds growth.

Verdict: utility-typical financial quality — stable margins, predictable regulated cash flows, returns that roughly equal the cost of capital, heavy leverage, and structural FCF deficits funded by debt and equity issuance. Nothing is broken; nothing is exceptional. The economics do not obviously improve with scale — they improve with rate base, which is a different and more capital-hungry thing.

7. Capital Allocation

(Enriched with the SEC-sweep / Capital-Allocation workstream findings.)

Capital allocation at a growth utility is mostly a single question — is the enormous capital budget being deployed into rate base at a return above its cost, and financed without destroying per-share value? — plus the smaller questions of dividend policy, M&A discipline and insider alignment.

The capital budget. The dominant use of capital is the ~$28.6B five-year plan. On the evidence, it is being deployed sensibly: into constructive jurisdictions, into a genuine load-growth opportunity (Genco), and with explicit risk mitigation (ring-fencing, contracted floors). The discipline signals are good — management reaffirmed the base plan rather than chasing capex for its own sake, kept O&M flat, and insists the incremental data-center capital carries “appropriate risk-adjusted returns” rather than blanket rate-base treatment. The Marathon caution applies (everyone is spending into the same AI-power wave), but NiSource’s spend is better-underwritten than most.

Financing / dilution — and the sophisticated minority-monetization playbook. The plan is funded with a balanced mix: retained cash flow, ~$400–600M/yr of new equity via an ATM (~$1.35B capacity remaining at year-end 2025, expiring Dec 2028), and new long-term debt, calibrated to hold FFO/debt at 14–16% and defend the investment-grade rating (S&P BBB+ / Moody’s Baa2 / Fitch BBB, all Stable; NIPSCO one notch higher at Moody’s Baa1). The cost is dilution: shares outstanding rose from ~373M (2019) to ~478.5M (early 2026), ~28% over seven years (~3.6%/yr) — a persistent headwind the per-share guide already nets out. What is more interesting is how management has minimized straight parent-equity dilution through a deliberate playbook: (1) the sale of ~19.9% of NIPSCO to Blackstone Infrastructure Partners (PSA June 2023, closed Dec 2023 for $2.16B cash, ~$800M above the carried NCI value); (2) a second sale of ~19.9% of the new “GenCo” (Generation Holdings) to Blackstone in Oct 2025 for $35.2M initial cash plus an equity commitment of up to $1.325B over seven years to fund the data-center generation build; and (3) a $1.0B 5.75% junior-subordinated hybrid issued Nov 2025 that earns ~50% equity credit from the agencies. Together with routine ATM issuance, these tools bring growth capital in at the subsidiary/hybrid level — smart financial engineering that funds a ~$30B capital cycle while limiting common-share dilution, at the cost of a ~$2.2B minority-interest earnings leak and a more complex capital structure. Preferred stock was cleaned up along the way (Series A/B redeemed 2023–24; the Series C mandatory-convertible converted to ~33.9M common shares in Dec 2023).

Dividend. NiSource pays a growing dividend — from $0.78/share (2018) to $1.12/share (2025), ~6%/yr and unbroken, a payout of ~48% of adjusted EPS (~2.3% yield) — intended to grow roughly in line with earnings. Notably, the dividend rose straight through the 2018 Massachusetts disaster and the Columbia Gas of MA divestiture (0.78 → 0.80 → 0.84), a genuine point of capital-allocation credibility: management took the $53M criminal fine and sold the franchise rather than cut the payout.

M&A / buybacks. No buybacks (correct for a company issuing equity to fund growth). M&A has been subtractive and disciplined: the company sold Columbia Gas of Massachusetts to Eversource (closed Oct 2020, ~$1.1B net) to exit a jurisdiction where it had lost its social license — taking the hit and simplifying the portfolio rather than empire-building.

Insider alignment — a real conviction tell at the lows. Insider ownership is low in dollar terms (all directors and officers <1% of the class; CEO Lloyd Yates the largest at ~959k shares). The compensation plan is heavily at-risk (CEO ~90%) and metric-driven — adjusted EPS (70% of the short-term incentive, 50% of the performance-share plan), relative TSR vs. ~31 utility peers (30% of PSUs), plus safety, methane-reduction and engagement — which aligns management with the disclosed EPS algorithm. Notably, there is no ROE or ROIC metric in the incentive plan — a subtle but real weakness, because it rewards growing EPS (achievable simply by deploying more capital at the allowed return, funded with equity) rather than earning a return above the cost of capital; it is an EPS-and-relative-TSR scheme, not a value-creation scheme. On transactions, the standout is a genuine bullish tell often missed: CEO Yates made a ~$1.06M discretionary open-market purchase of 40,000 shares at ~$26.44 in August 2023 — near the multi-year lows, shortly after signing the Blackstone/NIPSCO deal, and before the stock doubled. Recent 2025–26 named-officer activity is net selling (routine, partly Rule 10b5-1), which is neutral-to-mildly-negative but ordinary for a growth utility at all-time highs; it does not undo the signal value of the CEO having bought conviction-ally at the bottom.

Verdict: competent, disciplined capital allocation executed within the constraints of a capital-hungry growth utility. Capital is going to good places; the dividend is sustainable; the portfolio was simplified at the right time. The unavoidable blemish is chronic dilution — the shareholder is buying a growing pie in ever-more slices — which is why the per-share growth rate, not the headline rate-base or capex numbers, is the figure that matters.

8. Changes and Headwinds — Last Two Years

Positive changes (thesis-strengthening).

• The Genco data-center model went from concept to signed contracts. The anchor is the NIPSCO/Amazon (ADS) contract signed Sept 2025 — a 15-year agreement with capacity charges beginning Jan 2027 and an investment-grade Amazon parent guarantee, receiving IURC approval in June 2026. Management announced a further Alphabet partnership (~340 MW) and Amazon expansions on the Q1-2026 call (May 2026), bringing the total to ~800 MW secured within a ~4-GW signed / ~9-GW pipeline, with an expedited 90–120-day review path and ~$1.4B of retail-customer savings. (The Alphabet agreement is management-announced and pending regulatory approval; it post-dates the FY25 10-K and is not yet in a periodic filing — the Amazon/ADS contract is the filed, contractually-executed one.) This is the single most important development and the engine of the re-rating.
• A deliberate financing build-out to fund the cycle: the Oct-2025 sale of ~19.9% of the new GenCo to Blackstone (up to ~$1.325B of committed capital) and a ~$1.0B 5.75% junior-subordinated hybrid (Nov 2025, ~50% equity credit), on top of ongoing ATM issuance — engineered to defend the BBB+/Baa2 rating through a ~$30B six-year capital program.
• Long-term guidance raised. The 2023–2033 adjusted-EPS CAGR was lifted 100 bps to 9–10% in Q1 2026, with performance tracking the high end through 2030 and 9–11% rate-base growth — a rare upward revision in a sector where guidance is usually static.
• Constructive regulatory progress across jurisdictions: supportive Indiana legislation (HB 1002), Ohio SB 103, a settled Pennsylvania rate case (Dec 2025), and continued rider-based recovery that limits regulatory lag.

Headwinds and watch-items (thesis-testing).

• Coal-retirement friction / Schahfer. NIPSCO received a second federal (DOE 202©) order requiring continued operation of the Schahfer coal plant (through 2026), complicating the generation-transition timeline and cost recovery, and keeping older, less economic capacity online.
• Pennsylvania political scrutiny. Governor Shapiro’s 2026 letter to utilities signals affordability-driven scrutiny that could shape future rate-case strategy.
• Affordability / data-center backlash risk. The entire load-growth thesis depends on regulators and the public accepting large-load additions; the Genco savings-sharing is designed to defuse this, but it is the key political fault line.
• Financing sensitivity. A higher-for-longer rate environment raises the cost of the debt and equity funding a persistently FCF-negative build, and any need to accelerate equity issuance would pressure per-share growth.

Verdict: the last two years have materially strengthened the fundamental thesis — the growth is more visible, more contracted, and higher than before — while simultaneously pulling forward all of that good news into the price. The headwinds are manageable and mostly of the “watch closely” variety rather than clear and present dangers.

9. Risk Analysis

Catastrophic-loss assessment. The probability of a permanent capital loss is low: this is an investment-grade, monopoly-franchise, regulated utility with predictable cash flows. The realistic downside is not a zero but a de-rating — a 20–35% drawdown if the growth premium compresses toward the peer group and/or a data-center/regulatory disappointment lands, which the low beta (~0.4) and defensive demand would cushion but not prevent. The genuine tail risk is a catastrophic gas-safety event (the Merrimack Valley precedent), which is low-probability but franchise-threatening.

10. Valuation Discussion (Embedded Expectations)

No price target and no recommendation in this section — the analysis frames what the current price embeds.

Where the multiple sits. At ~$47.82, NiSource trades at:

• ~23× the FY26 adjusted-EPS guide midpoint ($2.045) — a premium to the regulated multi-utility peer group (WEC, AEE, CMS, DTE broadly ~18–21× forward);
• ~12.7× EV/EBITDA and ~5.7× EV/sales (both toward the high end of history);
• ~2.4× book value and ~3.3× sales — each in the ~99th percentile of NiSource’s own 10-year range (the single clearest valuation tell: this is the most expensive NiSource has ever been on the two multiples not distorted by GAAP-EPS noise);
• a dividend yield of ~2.3% — low for a utility, itself a symptom of the re-rating.

Peer context — the growth-adjusted nuance that saves the story from “just expensive.” Set against the Midwest multi-utility peer group, NiSource looks paradoxical: it carries the highest forward P/E yet the lowest EV/EBITDA and the highest growth rate. That combination is the crux of why this is a HOLD, not an AVOID.

(Peer multiples approximate, drawn from recent same-sector analysis; for relative context, not precision.) The read: on headline P/E NiSource is the most expensive name in the group — but it is also the fastest EPS grower (9–10% vs. peers’ 6–8%) and, tellingly, the cheapest on EV/EBITDA (~12.7× vs. peers’ 14–16×), the multiple that is not distorted by NiSource’s higher leverage and larger minority interest. On a growth-adjusted basis, NI is arguably not the most expensive utility — you pay ~23× for a 9–10% grower (a ~2.4× P/E-to-growth), versus WEC’s ~21× for 7–8% (~2.8×). The premium P/E is, to a first approximation, earned by the superior growth rate and the data-center optionality — which is precisely why the honest verdict is “fully priced, not mispriced,” and why the risk is the durability of that growth premium rather than an obvious overvaluation. The offsetting cautions are NI’s lower dividend yield (2.3% — you are paid less to wait), its heavier leverage (89% debt/cap vs. peers’), and the 99th-percentile P/B and P/S on its own history — the multiple has never been higher, whatever the peer-relative math.

What the price embeds. Reverse-engineering the multiple, the market is underwriting roughly the following as base case, not upside: (1) the full 9–10% adjusted-EPS CAGR delivered through 2030 and sustained toward 2033; (2) the Genco pipeline converting broadly as guided, with the $0.25–0.35 (2030) / $0.40–0.60 (2033) data-center EPS layer materializing; (3) constructive regulatory outcomes and no affordability-driven backlash; and (4) the balance sheet holding at 14–16% FFO/debt without a dilutive equity air-pocket. In other words, the current price requires the plan to substantially work. That is not an unreasonable expectation — the plan is credible and partly contracted — but it leaves little margin of safety and prices out most of the “strategic negotiations” optionality as if it were already probable.

Scenario framing (illustrative, not a target).

• Bear (~$34–40): growth premium compresses toward the peer group (~18–19× forward) as the market marks the CAGR to ~7–8% on a regulatory or demand disappointment; still a fine business, re-rated to a fair utility multiple. This is roughly where NI traded in early 2025 and implies ~15–30% downside.
• Base (~$44–50): the plan delivers as guided; EPS compounds ~9%, the multiple holds near the current premium, and the stock advances broadly with earnings — a mid-single-digit-plus total return including the dividend, with the multiple doing none of the work.
• Bull (~$55–62): the 3-GW strategic-negotiations bucket converts to signed, NIPSCO-owned generation; the CAGR is re-rated toward/above 10%; and the market extends the premium, driving a low-teens-plus total return.

Embedded-expectations verdict. The market is pricing the growth correctly in direction and roughly in magnitude, but is underwriting the successful execution of a decade-long plan as the base case and paying an all-time-high relative multiple to do so. The asymmetry is unattractive at today’s price: modest upside if everything goes right, meaningful downside if the premium normalizes. This is a valuation where the earnings, not the multiple, must do the work — and where the entry price materially determines the return.

11. Variant Perception

Consensus view. The sell-side and the tape are aligned and constructive: NiSource is a premier data-center-load utility with the best-located electric franchise, a clever Genco model, top-quartile 9–10% EPS growth, and constructive regulation — a “sleep-well-at-night compounder with a growth kicker.” Recent Street action (e.g., RBC’s July 2026 Outperform initiation at a ~$52 target) reflects this. The stock’s low beta, positive alpha, and ~+25% one-year run mark it as a crowded, well-owned momentum utility.

The strongest bull case. NIPSCO’s Indiana territory is a scarce, strategically vital asset in the AI-power era; the Genco model is a durable regulatory innovation that converts that scarcity into ring-fenced, above-rate-base returns while defusing political risk; the ~9-GW pipeline is largely upside to a guide that already excludes it; and a utility that can credibly compound EPS at 9–10% for a decade deserves — and will keep — a premium multiple. On this view, today’s price is a fair entry into a multi-year compounder and the multiple is justified by the growth’s durability and visibility.

The strongest bear case. You are paying an all-time-high relative multiple for a regulated return stream whose ROIC only equals its cost of capital, whose growth is fully disclosed and equity-funded (chronic ~2–3%/yr dilution), and whose premium rests on a demand cycle (hyperscaler AI capex) that is concentrated, cyclical, and outside the company’s control. The Genco returns are real but small relative to the $22.8B market cap; the balance sheet is stretched (89% debt/cap) into a rising-cost financing environment; and the entire re-rating can unwind if a single regulatory or affordability shock, or a cooling of the AI-capex wave, marks the CAGR back toward the peer average. The factor read supports the caution: this is a low-beta momentum name at an all-time high — the crowded side of the boat.

The 3–5 assumptions that matter most, and what would falsify each:

1. The 9–10% EPS CAGR is durable → falsified by two consecutive guidance cuts, a major disallowed rate-case outcome, or the CAGR being re-marked to the ~7% peer norm.
2. Genco converts and scales (owned generation) → falsified by the ~3-GW strategic-negotiations bucket failing to sign, or converting only as low-return capacity purchases rather than owned rate base.
3. Regulators/politicians stay constructive on data-center cost allocation → falsified by an affordability-driven order that reallocates large-load cost to the utility/retail base or caps the Genco return.
4. The balance sheet holds at 14–16% FFO/debt without a dilutive shock → falsified by a rating downgrade or a step-up in equity issuance that visibly dilutes the per-share CAGR.
5. The premium multiple persists → falsified by a sector-wide utility de-rating (higher-for-longer rates) or a rotation out of crowded low-beta momentum, independent of NiSource’s own execution.

Variant-perception verdict. The interesting variant is not on the business — consensus has that broadly right — but on the price. The differentiated view worth holding is that NiSource has become a genuinely better company and a fully-priced one at the same time, so the return from here is far more a function of entry price than of thesis, and the risk/reward only becomes attractive on a pullback toward the mid-$40s or below.

12. Fact vs. Interpretation

13. Open Questions

1. How much of the ~9-GW pipeline will convert, at what returns, and how much will NIPSCO own vs. contract? Owned generation earns on rate base and compounds; capacity purchases earn a thinner spread. The mix determines whether the CAGR pushes above 10%.
2. What is the true, normalized adjusted-EPS base and the exact 2026–2030 path once one-time items and the Genco ramp are isolated? (GAAP EPS exceeding adjusted EPS in FY25 is unusual and warrants reconciliation to the 10-K.)
3. How will Pennsylvania (post-Shapiro-letter) and Indiana regulators treat data-center cost allocation and affordability as bills rise? This is the central political fault line.
4. What is the Schahfer coal-plant endgame — how long do the federal orders extend, and what is the stranded-cost/recovery exposure?
5. How sensitive is the plan to financing costs — at what rate environment does the equity cadence step up enough to visibly dilute the per-share CAGR?
6. What are the precise allowed ROEs and equity-layer approvals in each of the six jurisdictions, and their trajectory under affordability pressure?

14. What Must Be True

For the bull case to be right:

• NIPSCO converts a meaningful share of the ~3-GW strategic-negotiations pipeline into signed, largely owned generation at risk-adjusted returns, pushing the adjusted-EPS CAGR toward/through 10% and adding to the Genco EPS layer.
• Indiana and the other five jurisdictions stay constructive — approving special contracts, riders and equity layers — with data-center growth accepted by regulators and the public because retail bills fall (the $1.4B savings mechanism works as designed).
• The balance sheet holds at 14–16% FFO/debt with equity issued at healthy prices, so per-share growth is not eroded by financing.
• Falsification test: two consecutive quarters of guidance reduction, a materially adverse rate-case or Genco-return ruling, or a rating downgrade — any one breaks the “durable 9–10% compounder” premise.

For the bear case to be right:

• The premium multiple compresses toward the peer group as the market either marks the CAGR down (on a regulatory/demand disappointment) or rotates out of crowded low-beta momentum, independent of execution.
• Data-center demand cools or concentrates further, thinning the pipeline that justifies the premium, and/or a regulatory/affordability backlash reallocates large-load cost or caps Genco returns.
• The FCF-negative build forces accelerated equity issuance that visibly dilutes the per-share CAGR.
• Falsification test: the CAGR is raised again with FFO/debt intact, the strategic-negotiations pipeline converts to owned generation, and the multiple holds — which would confirm the growth is durable and the premium warranted.

The synthesis: both cases agree the business is good and getting better; they disagree only on whether today’s all-time-high relative price leaves any reward for owning it. That makes NiSource a name to own on weakness, not on strength — the thesis is about entry price, not about the company.

15. Source Appendix

See the separate Source Appendix (Appendix B) for the full citation list. Primary sources: NiSource FY2025 Form 10-K (filed Feb 11, 2026) and 2021–2025 10-Ks; Q1-2026 Form 10-Q (filed May 6, 2026); Q1-2026 earnings-call transcript (May 6, 2026); DEF 14A proxy statements; 8-K filings on the Amazon/Alphabet Genco contracts and guidance; the 2022 Blackstone/NIPSCO transaction disclosures; ROIC.ai (financials, ratios, enterprise value, valuation multiples); AZI (price history, valuation-percentile ranks, news); FactorsToday (factor loadings, risk-adjusted track record). Quantitative data reconciled to filings where NiSource is the primary source.

APPENDIX A — Standard Diligence Questionnaire

NiSource Inc. (NYSE: NI) — as of July 4, 2026

Supplemental to the research memo. Fact / Interpretation / Assumption labels applied where it matters.

General

What thoughtful questions have other investors asked about this company? The recurring questions cluster around (1) how much of the ~9-GW data-center pipeline converts, at what returns, and how much NIPSCO owns vs. contracts — the single biggest swing factor for the CAGR; (2) whether the premium multiple is sustainable given ROIC only equals cost of capital; (3) the financing plan’s dilution ($400–600M/yr ATM, ~18% share growth over four years); (4) regulatory/affordability durability of the Genco savings-sharing model, especially in Pennsylvania post-Shapiro-letter; and (5) the Schahfer coal-plant endgame under repeated federal operation orders. On the Q1-26 call, analysts (Wells Fargo, UBS, Jefferies, JPMorgan, Evercore, Wolfe, Morningstar, Ladenburg) pressed hardest on pipeline conversion, the earnings mechanics of capacity purchases vs. owned generation, and ATM latitude — signaling the Street’s focus is execution and financing, not demand. (Fact: transcript topics.)

Cyclicality & Earnings Nature

Are earnings at a cyclical high or low? Neither in the traditional sense — regulated utility earnings are not economically cyclical. NiSource’s earnings are at an all-time high and rising structurally, driven by rate-base growth, not by a cyclical peak. (Interpretation.) The one cyclical input is the AI-data-center capex wave feeding the growth kicker, which is cyclical and could cool.

Driven by the external environment or internal actions? Predominantly internal/regulatory — capital deployment into rate base and constructive rate outcomes. The external driver is hyperscaler demand (Genco). (Fact/Interpretation.)

How stable are revenues? Very stable. ~100% regulated delivery revenue; commodity gas cost is a pass-through, so margin is insulated from gas prices. Weather and volume risk is largely mitigated by decoupling/fixed charges. (Fact.)

Outlook for products/services? Positive — regulated gas/electric delivery with a multi-year load-growth tailwind. Gas LDC (~4–6% rate-base growth) is steady; NIPSCO electric (data-center) is the accelerant.

How big will this market be — growing, shrinking, domestic or international? Domestic (six US states). The addressable “market” is rate base, which management guides to grow 9–11%/yr — a growing, not shrinking, opportunity, unusually so for a utility. (Fact: guidance.)

Business Quality & Competitive Moat

Is the industry getting more or less competitive? Structurally non-competitive (franchised monopolies). The “competition” is regulatory. Data-center load is intensifying utility-vs-utility competition for hyperscaler contracts at the margin (NIPSCO vs. AEP Indiana, Duke Indiana), but not for the core franchise. (Interpretation.)

How profitable is the business (ROIC, ROE)? ROIC ~5.8% (≈ cost of capital); ROE ~10% (in line with allowed equity returns). Utility-typical: modest ROIC levered down by 50%+ debt, respectable ROE. (Fact: ROIC data.)

How profitable is the industry — competitors, barriers to entry? Barriers to entry are near-absolute (nobody builds duplicate distribution networks). Industry returns are administratively capped at allowed ROEs (~9.5–10%). Durable but bounded. (Fact/Interpretation.)

Can the business be easily understood? Yes — a regulated rate-base-growth utility. The one nuance requiring work is the Genco off-rate-base contract model. (Interpretation.)

Can it be undermined by foreign low-cost labor? No — physical, local, regulated infrastructure. (Fact.)

Do brands matter? No, in the consumer sense. “Columbia Gas” / “NIPSCO” are regulatory identities, not pricing-power brands. What matters is regulatory relationships and reputation (the 2018 Massachusetts disaster showed the cost of losing social license). (Interpretation.)

Nature of competition? Regulatory (rate cases, allowed returns) plus, newly, competition for hyperscaler contracts where speed-to-power and location are the differentiators. (Interpretation.)

Customers’ switching costs? Effectively infinite for retail customers (no alternative distributor). Data-center customers sign long-term bilateral contracts with minimum demand charges. (Fact.)

Financial Condition & Balance Sheet

Assets not fully recognized on the balance sheet? The regulatory franchise itself (the monopoly right) is not capitalized. Regulatory assets (recoverable costs) are on the balance sheet. (Interpretation.)

Off-balance-sheet liabilities? Standard utility items — purchase-power/gas-supply commitments, pension/OPEB, AROs (asset-retirement obligations, notably coal-ash/decommissioning). Nothing unusual flagged. (Fact/Assumption — pending full 10-K note review.)

How conservative is the accounting? Regulated-utility accounting (ASC 980) is prescriptive; the main judgment areas are regulatory-asset recoverability and the adjusted-vs-GAAP EPS bridge. GAAP EPS ($1.97) exceeding adjusted (~$1.85) in FY25 is unusual and warrants reconciliation. (Open question.)

How CapEx-hungry is the business? Extremely — this is the defining feature. FY25 capex ~$4.5B vs. OCF ~$2.4B; structurally FCF-negative, funded by debt + equity. A ~$28.6B five-year plan. (Fact.)

Capital Allocation & Management

How much FCF does the business generate, and how is it used? Negative FCF by design (growth capex > OCF). “Free” cash is a mis-fit metric here; the relevant use of capital is rate-base investment. Retained cash + new debt + ATM equity fund the plan; the dividend (~48% payout) is funded from earnings. (Fact.)

Significant acquisitions recently? No acquisitions; the notable M&A was a divestiture — Columbia Gas of Massachusetts sold to Eversource (2020). Disciplined portfolio simplification. (Fact.)

Buying back shares? No — the company issues equity ($400–600M/yr ATM) to fund growth; buybacks would be incoherent. (Fact.)

Issuing large amounts of new shares to insiders? No unusual insider issuance; routine equity comp. Ongoing ATM issuance to the market dilutes ~3–4%/yr (shares +~28% over seven years). Minority capital was raised at the subsidiary level instead: Blackstone bought ~19.9% of NIPSCO (closed Dec 2023, $2.16B) and ~19.9% of GenCo (Oct 2025, $35.2M initial + up to $1.325B committed) — together the ~$2.2B minority interest — a deliberate lever to fund the ~$30B capital plan while limiting common dilution. (Fact.)

Compensation policy / motivations of management? Incentive plans are heavily at-risk (CEO ~90%) and weighted to adjusted EPS (70% of STI, 50% of PSUs), relative TSR vs. ~31 utility peers (30% of PSUs), and safety/methane/engagement — aligned with the disclosed EPS algorithm but with no ROE or ROIC metric (rewards deploying capital at the allowed return, not earning above cost of capital). Insider ownership is low in dollar terms (all insiders <1%). The one genuine conviction signal: CEO Yates bought ~$1.06M of stock at ~$26 in August 2023 near the lows; 2025–26 activity is routine net selling at highs (partly 10b5-1). (Fact — SEC-sweep findings.)

Valuation & Market Data

Is the stock an ADR, MLP, or K-1 issuer? No — a US C-corp common stock (NYSE: NI), standard 1099 dividend reporting. (Fact.)

Dividend policy? Growing dividend, ~$1.12/share FY25, ~48% payout of adjusted EPS, ~2.3% yield; intended to grow roughly with earnings (mid-single-digit). No cut through the 2018 disaster. (Fact.)

How profitable is the business? See ROIC ~5.8% / ROE ~10% above — utility-typical, returns ≈ cost of capital. (Fact.)

Is net income diverging from cash from operations? OCF consistently exceeds net income (~2.5× in FY25) — normal for a heavy-depreciation utility; healthy, not a red flag. The divergence to watch is OCF vs. capex (structurally negative FCF), not OCF vs. net income. (Fact.)

Risks & Downside

What factors would cause the stock to decline? (1) Multiple compression toward the peer group from an all-time-high premium; (2) a regulatory/affordability backlash on data-center cost allocation; (3) cooling AI-capex thinning the pipeline; (4) financing/rating pressure in a higher-for-longer environment; (5) an adverse rate-case or allowed-ROE outcome; (6) execution/cost overruns on generation. (Interpretation.)

Risk of a catastrophic loss? Low probability of permanent capital loss (investment-grade monopoly utility). The realistic downside is a 20–35% de-rating, cushioned by low beta (~0.4) and defensive demand. (Interpretation.)

Chance of a total loss? Negligible in any reasonable scenario. The genuine tail risk is a catastrophic gas-safety event (Merrimack Valley precedent, ~$1B+ and a lost franchise) — low-probability, franchise-threatening, not company-ending. (Interpretation.)

Recent News & Events

Has the business environment changed recently? Yes, materially and favorably: the Genco data-center model moved from concept to signed Amazon + Alphabet contracts (~800 MW, ~4 GW signed, ~9-GW pipeline), IURC approval landed June 2026, and management raised the long-term adjusted-EPS CAGR 100 bps to 9–10%. RBC initiated Outperform (~$52 PT) in July 2026. (Fact: news feed, transcript, 8-Ks.)

Significant acquisitions? None recently (see divestiture above).

Change in accounting policies? None flagged beyond ongoing regulatory-accounting application. (Assumption — pending 10-K note review.)

Recent changes — new markets, facilities, management? New data-center generation build (CCGTs, batteries, contracted capacity via the Genco pool); continued coal-to-clean generation transition (Schahfer retirement, delayed by federal 202© orders through 2026); constructive regulatory/legislative developments (Indiana HB 1002, Ohio SB 103, settled PA rate case Dec 2025). (Fact.)

APPENDIX B — Source Appendix

NiSource Inc. (NYSE: NI) — Research as of July 4, 2026

Primary sources first. All quantitative figures reconciled to SEC filings where NiSource is the primary source; third-party aggregators (ROIC.ai, AZI, FactorsToday) used for computed ratios, price history and factor data, and flagged as such.

Primary — SEC Filings (EDGAR, CIK 0001111711)

1. NiSource FY2025 Form 10-K — filed 2026-02-11 (nix-20251231.htm). Segments (Columbia / NIPSCO recast eff. 1/1/2024), Note 4 (noncontrolling interests — Blackstone NIPSCO & GenCo transactions), Note 6 (preferred/equity units), MD&A (capex plan 2025–2030, ratings table, ADS/Amazon contract, R.M. Schahfer DOE §202© orders), regulatory ROE table, balance sheet, statement of equity.
2. NiSource FY2020–FY2024 Form 10-Ks — filed 2021-02-17, 2022-02-23, 2023-02-22, 2024-02-21, 2025-02-12. Dividend history; Columbia Gas of Massachusetts sale to Eversource (APA 2020-02-26, closed 2020-10-09, ~$1,113M net); Greater Lawrence plea ($53.03M fine, 2020-06-23).
3. NiSource Q1-2026 Form 10-Q — filed 2026-05-06 (nix-20260331.htm).
4. NiSource DEF 14A proxy — filed 2026-03-30. CEO/NEO compensation; STI/PSU incentive metrics (Adj EPS, relative TSR, safety, methane); ownership guidelines; 5% holders (Vanguard 11.3%, T. Rowe 10.5%, BlackRock 9.9%, State Street 5.0%); board composition; say-on-pay.
5. Form 4 filings (EDGAR) — insider transactions; CEO L. Yates open-market purchase 40,000 sh @ $26.44 (2023-08-23); Director E. Butler purchase (2021-05); CFO Anderson 10b5-1 sale (2026-05).
6. 8-K filings — 2025-01-24 (Luhrs RSU award); Sept-2025 (ADS/Amazon contract); 2025-10-31 (ATM/forward equity program; GenCo minority close); 2025-11-07 ($1.0B 5.75% junior-subordinated hybrid notes due 2056); 2025-12-11 (revolver upsize); Dec-2025 (DOE §202© Schahfer order); 2026-05-18 ($500M 4.75% notes 2031 + $750M 5.30% notes 2036).

Primary — Company Investor Materials / Transcripts

7. NiSource Q1-2026 earnings call transcript — May 6, 2026 (via ROIC.ai). FY26 adj-EPS guide $2.02–$2.07; 2023–2033 adj-EPS CAGR raised 100 bps to 9–10%; 9–11% rate-base growth; $21B base + ~$7.6B GenCo capital; Amazon expansions + Alphabet (~340 MW) partnership announcement; ~4 GW signed / ~9 GW pipeline; GenCo 2030/2033 EPS ($0.25–0.35 / $0.40–0.60); FFO/debt 14–16%; $400–600M/yr ATM equity.
8. NiSource IR investor deck / supplemental slides — Q1-2026 (referenced on the call).

Regulatory / Industry

9. Indiana Utility Regulatory Commission (IURC) — ADS/Amazon ring-fence framework approval (Sept 2025, reaffirmed Nov 2025); GenCo special-contract approvals (June 2026).
10. Indiana House Bill 1002 (2026) — residential affordability / levelized billing / performance-based ratemaking.
11. Ohio Senate Bill 103 (2025) — forward test period + large-load custom contracts (passed Senate 31-0, Oct 2025).
12. Pennsylvania — Governor Shapiro letter to 24 utilities (April 29, 2026) on rate increases / profit caps.
13. U.S. DOE Federal Power Act §202© emergency orders — R.M. Schahfer continued operation (first Dec 2025, extended through 2026-03-23).

Third-Party Data (computed ratios / price / factors — reconciled to filings)

14. ROIC.ai MCP — income statement, balance sheet, cash flow, profitability ratios (ROIC/ROE/margins), enterprise value, valuation multiples, per-share data, earnings-call transcripts. FY2020–FY2025.
15. AZI (azitrading.com) — 5-year adjusted/unadjusted daily price CSV (OHLCV, EMAs, beta/alpha); fundamentals valuation_index own-history percentile ranks (P/E 75.7th, P/B 99.3rd, P/S 98.8th, composite 91.3rd, as of 2026-07-02); news feed.
16. FactorsToday (factorstoday.com) — factor loadings (ElasticNet betas; Utilities sector dominant, R² 0.67–0.72), leaderboard (risk-adjusted returns/Sharpe/Sortino/max-drawdown by horizon), stock-info (beta ~0.36, positive alpha).
17. RBC Capital Markets — initiation of coverage, Outperform, ~$52 price target (July 2, 2026) — cited as consensus color only.

Notes on data provenance

• Where ROIC.ai and a filing disagree on a material number, the filing governs. ROIC classifies utility construction capex partly under “other investing,” so reported capex (~$4.5B FY25) is reconstructed to the 10-K cash-flow statement.
• AZI valuation percentiles are the stock’s own multi-year history (not cross-sectional).
• The Alphabet partnership is management-announced (Q1-2026 call) and pending regulatory approval; it post-dates the FY2025 10-K and is not yet in a periodic filing. The Amazon/ADS contract is the filed, contractually-executed agreement.