TacticScaleWhat NiSource Does & How It Makes Money (NI)
Updated October 2026 · reflects NiSource's latest reported financials
Regulated natural gas and electric utility holding company in the U.S. It earns regulated revenue by charging residential, commercial and industrial customers for natural gas distribution and for generating, transmitting and distributing electricity.
How NiSource makes money
It earns regulated revenue by charging residential, commercial and industrial customers for natural gas distribution and for generating, transmitting and distributing electricity. It also earns some revenue from wholesale electric and transmission transactions.
What NiSource does
NiSource is a U.S. energy holding company that operates regulated natural gas and electric utilities in two segments: Columbia Operations and NIPSCO Operations. It serves residential, commercial and industrial gas customers through about 37,300 miles of distribution main and 310 miles of transmission main in Ohio, Pennsylvania, Virginia, Kentucky and Maryland. In northern Indiana, it generates, transmits and distributes electricity to about 0.5 million customers and takes part in wholesale electric and transmission transactions. Its generation fleet includes coal plants in Wheatfield and Michigan City, a combined-cycle gas turbine in West Terre Haute, gas units in Wheatfield, hydro plants, wind units in White County, and solar units in several Indiana counties. It was founded in 1847, was formerly NIPSCO Industries, and is headquartered in Merrillville, Indiana.
Products & services
- Columbia Operations (natural gas distribution)
- NIPSCO Operations (electric and gas utility)
- Natural gas distribution and transmission pipelines
- Electricity generation, transmission and distribution
- Wholesale electric and transmission services
- Wind, solar and hydro generation
What is NiSource worth?
On an owner-earnings DCF, NiSource's most-likely value is about $2 versus a recent price near $41 (94% above fair value). But TacticScale only calls a stock undervalued when the price sits below its conservative no-growth floor (~$1) with a margin of safety — so the honest verdict here is “Stretched — richly priced.” Fair value earns its keep only at the extremes, not in the wide middle.
Today's $41 is above even the optimistic Bull case ($3) — the market expects faster, longer growth than modeled here. Expensive unless that extra growth actually shows up.
⚠ High leverage — net debt is 351.2× annual cash flow. Net debt is subtracted from this fair value, but refinancing at higher rates, principal timing, and share dilution aren’t modeled — the equity can be worth far less if cash flow weakens.
⚠ Capital-intensive — this business reinvests heavily, so free cash flow runs well below its earnings. Fair value here is built on free cash flow, which understates owner earnings for reinvestment-heavy companies — read it as conservative.
Analysis, not advice. Fair value is a margin-of-safety estimate from a deterministic owner-earnings DCF, not a price target or recommendation. See the full breakdown →
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