DCF Studio

    NI · NYQ · Utilities

    NiSource Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 1.53

    Market price

    USD 44.86

    Implied upside

    -96.6%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Wrong toolThis model values the shares at 3.4% of the market price. A gap that size is a modelling failure rather than a view - most often an unusable beta, a currency or units mismatch, or a cashflow base that does not represent the business. Read the figures below as diagnostics, not as a call.
    AdjustedFree cashflow is negative in at least one forecast year, so terminal value carries most of the valuation.
    AdjustedCapital expenditure runs at 45.4% of revenue against depreciation of 16.8%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Value Per Share

    Perpetuity growth
    USD 1.53-96.6%
    Exit multiple
    USD 23.25-48.2%
    Market price
    USD 44.86

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    -1bn0bn1bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 7.1bnUSD 7.4bnUSD 7.6bnUSD 7.9bnUSD 8.1bnUSD 8.4bnUSD 8.7bnUSD 8.9bnUSD 9.1bnUSD 9.4bn+3.1%
    EBITUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.1bnUSD 2.2bnUSD 2.2bnUSD 2.3bn+3.1%
    NOPATUSD 1.4bnUSD 1.5bnUSD 1.5bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bnUSD 1.8bnUSD 1.9bnUSD 1.9bn+3.1%
    Add depreciation & amortisationUSD 1.2bnUSD 1.2bnUSD 1.3bnUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.5bnUSD 1.5bnUSD 1.5bnUSD 1.6bn+3.1%
    Less capital expenditureUSD -3.2bnUSD -3.2bnUSD -3.1bnUSD -3.0bnUSD -2.9bnUSD -2.8bnUSD -2.7bnUSD -2.6bnUSD -2.5bnUSD -2.3bn-3.7%
    Capex, % of revenue45.4%43.1%40.8%38.4%36.1%33.8%31.5%29.2%26.8%24.5%-
    Less increase in working capitalUSD -45.1mUSD -27.1mUSD -26.9mUSD -26.6mUSD -26.3mUSD -25.8mUSD -25.3mUSD -24.6mUSD -23.9mUSD -23.0m-7.2%
    Free cashflow to firmUSD -633.2mUSD -466.5mUSD -305.1mUSD -131.2mUSD 55.1mUSD 253.4mUSD 463.4mUSD 684.7mUSD 916.6mUSD 1.2bn-
    Discount factor0.96860.90860.85240.79970.75020.70380.66020.61940.58100.5451-
    Present valueUSD -613.3mUSD -423.9mUSD -260.1mUSD -104.9mUSD 41.3mUSD 178.3mUSD 306.0mUSD 424.1mUSD 532.6mUSD 631.5m-
    Present Value Of The ForecastUSD 711.7m

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.689Reported 0.536, pulled toward 1.0 (Blume)
    Cost of equity7.81%Risk-free + beta x equity risk premium
    Cost of debt6.00%Risk-free + 111bp, the spread for a BBB rating at 2.8x interest cover. Book interest / average debt was lower, at 4.4%.
    Market capitalisationUSD 21.5bn57.0% of capital
    Total debtUSD 16.2bn43.0% of capital, book value as a proxy
    Tax rate16.9%Effective, capped at statutory
    WACC6.60%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 1.53

    96% of EV

    Forecast FCFF, final year
    USD 1.2bn
    Capex at depreciation, working capital in reinvestment
    USD 1.9bn
    Less reinvestment at g/ROIC (37.9% of NOPAT)
    USD -721.2m
    Capitalised
    USD 1.2bn
    ROIC (WACC floor)
    6.6%
    Terminal value, undiscounted
    USD 29.6bn
    Terminal value, discounted
    USD 16.1bn
    Enterprise value
    USD 16.8bn
    Less net debt
    USD 16.1bn
    Equity value
    USD 726.0m

    Exit at 12.5x EBITDA

    Value per shareUSD 23.25

    97% of EV

    Terminal value, undiscounted
    USD 48.5bn
    Terminal value, discounted
    USD 26.4bn
    Enterprise value
    USD 27.1bn
    Less net debt
    USD 16.1bn
    Equity value
    USD 11.0bn

    Spread between methods: 175%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.60%31.8933.5836.5742.0653.49
    5.60%12.6611.7210.799.858.92
    6.60%3.032.281.530.780.03
    7.60%-3.93-4.54-5.16-5.78-6.39
    8.60%-9.16-9.67-10.19-10.70-11.22

    Outlined: this model. Green text: above today's price of 44.86. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year4.3%3.5%12.0%
    EBIT margin27.6%24.5%43.7%
    Discount rate-6.6%4.4%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.