Current Price
$40.63
Intrinsic Value
Use the calculator below to estimate
COMPETITIVE MOAT
↑Regulated Monopoly Infrastructure
NiSource operates essential gas and electric infrastructure, granting it a de facto monopoly in its service territories. This physical network is extremely difficult and costly for competitors to replicate.
↑High Switching Costs for Customers
Residential and commercial customers have virtually no ability to switch energy providers due to the nature of the regulated utility model. This creates a stable and predictable customer base.
↑Long-Term Capital Intensive Assets
The company's extensive network of pipelines and distribution systems represents a significant barrier to entry. These assets require massive upfront investment and long lead times to build.
INVESTMENT RISKS
↓Interest Rate Sensitivity
As a capital-intensive utility, NiSource relies heavily on debt financing. Rising interest rates increase borrowing costs, potentially impacting profitability and dividend capacity.
↓Environmental and Climate Change Regulations
Increasingly stringent environmental regulations and the transition to cleaner energy sources pose significant compliance costs and potential asset stranding risks.
↓Operational and Safety Incidents
Accidents or service disruptions can lead to significant financial penalties, reputational damage, and increased regulatory oversight, impacting operations and investor confidence.
Customize the NI valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for NiSource Inc respond.
Open DCF Calculator for NICompany Overview
NiSource Inc., an energy holding company, operates as a regulated natural gas and electric utility company in the United States. It operates in two segments, Columbia Operations and NIPSCO Operations. The company provides natural gas to residential, commercial, and industrial customers through approximately 37,300 miles of distribution main pipeline and the associated individual customer service lines; and 310 miles of transmission main pipeline in Ohio, Pennsylvania, Virginia, Kentucky, and Maryland. It also generates, transmits, and distributes electricity to approximately 0.5 million customers in various counties in the northern part of Indiana, as well as engages in wholesale electric and transmission transactions. It owns and operates steam coal generating stations in Wheatfield and Michigan City; combined cycle gas turbine in West Terre Haute; natural gas generating units in Wheatfield; hydro generating plants in Carroll County and White County; wind generating units in White County; and solar generating units in Sullivan County, Gibson County, Jasper County, and White County. The company was formerly known as NIPSCO Industries, Inc. and changed its name to NiSource Inc. in April 1999. NiSource Inc. was founded in 1847 and is headquartered in Merrillville, Indiana.
Financial Metrics — NI Stock Valuation Data
Revenue/Share (TTM)
$14.35
FCF/Share (TTM)
$-2.26
ROIC (TTM)
4.6%
ROE (TTM)
9.6%
P/FCF
n/m
EV/EBITDA
11.5x
FCF Yield
-5.58%
Debt/Equity
1.83x
NI currently has negative free cash flow, so cash-flow ratios such as P/FCF and FCF yield do not give a meaningful read on whether the stock is cheap or expensive. A DCF valuation is unreliable until cash generation turns positive — focus on the path to profitability instead.
Frequently Asked Questions
What is the intrinsic value of NI?
NiSource Inc currently generates $-2.26 in free cash flow per share. At the current price of $40.63, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is NI undervalued?
NI currently has negative free cash flow, so its P/FCF ratio is not meaningful and cannot tell you whether the stock is cheap or expensive. With cash flow negative, a DCF-based undervalued or overvalued judgment is unreliable — look at the path back to positive cash generation instead.
How do I value NI stock using DCF?
To perform a DCF valuation on NiSource Inc: (1) Start with the trailing free cash flow per share ($-2.26) as the base, (2) project future FCF growth over 5-10 years based on Regulated Gas industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting NI's risk profile — with a debt-to-equity of 1.83x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to NI?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For NiSource Inc, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Regulated Gas trends, then discounting those amounts to today's dollars. NI's ROIC of 4.6% means the company's return on invested capital sits below the level that typically clears its cost of capital.
How does WACC affect NI stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For NI, with a debt-to-equity ratio of 1.83x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 11.5x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See NI PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Utilities valuationsDCF and P/E value NI with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-08-21. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.