CFRA raises NiSource stock price target to $45 on growth outlook

CFRA raised its price target on NiSource (NI) to $45 from $39, citing attractive growth opportunities, including an 8-10% rate base growth target through 2029, low tariff risk, and potential data center demand. Despite this, the firm maintained a "Hold" rating, noting NiSource's premium valuation, which limits near-term upside with the stock trading near its 52-week high and the new target implying a 22.3x 2026 EPS multiple, above its historical average. This follows NiSource's Q2 2025 earnings and revenue exceeding analyst expectations, though the stock experienced a slight pre-market decline.

Analysis

CFRA has raised its price target for NiSource (NI) to $45.00 from $39.00, reflecting confidence in the company's growth trajectory, while maintaining a 'Hold' rating due to valuation concerns. The upward revision is underpinned by a robust 8%-10% rate base growth target for 2025-2029, minimal regulatory risk, and potential long-term upside from data center demand. This positive outlook is further supported by NiSource's recent Q2 2025 performance, where it surpassed analyst expectations with an adjusted EPS of $0.22 and revenue of $1.16 billion. However, the 'Hold' rating is justified by the stock's premium valuation; the new price target implies a 22.3x multiple on 2026 earnings, significantly above its five-year forward average of 17.6x and a premium to its peers. With the stock already trading near its 52-week high after a 39% return over the past year, this valuation suggests limited near-term upside, a sentiment possibly reflected in the stock's slight pre-market decline despite the strong earnings report.

Key Decisions for Investors

• Given the stock is trading near its 52-week high at a premium valuation of 22.3x 2026 EPS, investors with existing positions may consider the 'Hold' rating a signal to trim holdings and realize recent gains.
• Prospective investors should weigh the strong 8-10% rate base growth outlook against the high forward P/E multiple, suggesting that waiting for a more favorable entry point might be prudent despite the positive fundamentals.
• Investors should monitor any concrete developments related to data center demand, as this is a key long-term catalyst that could provide upside beyond the current valuation and justify a more bullish stance in the future.