NiSource (NI) Scales 52-Week High On Solid Investment Plans

NiSource Inc. (NYSE:NI) ) hit a new 52-week high of $24.31 during yesterday’s trading session and finally closed at $23.90. Merrillville, IN-based NiSource is an energy holding company that, together with its subsidiaries, provides natural gas, electricity and other products and services in the U.S.

Over the past 52 weeks, NiSource’s shares have ranged from a low of $16.04 on Sep 4, 2015 to a high of $24.31 on May 17, 2016. The average volume of shares traded over the last three months is approximately 2.5 million.

What is Driving NiSource Upward?

NiSource’s shares have been on the rise since May 3, when the company declared impressive first-quarter 2016 results. Earnings of 60 cents per share in the quarter exceeded the Zacks Consensus Estimate of 58 cents by 3.4%. Earnings were also up 5.3% from the year-ago figure. For 2016, NiSource expects earnings in the range of $1.00 to $1.10 per share.

Notably, over the last four quarters, NiSource has surpassed earnings expectations thrice, with an average positive surprise of 46.71%.The long term earnings growth is currently pegged at 6.3%.

We believe that the companyis being driven by its focus on core, rate-regulated, asset-based businesses. It has a planned capital investment target of over $1.4 billion in 2016, which is part of an ambitious long-term investment plan of $30 billion for utility infrastructure opportunities. Continued investments will allow the company to achieve its targeted earnings growth of 4% to 6%. The company also plans to invest nearly $400 million in its electric segment in this year to further strengthen its existing operations. Such systematic investments will improve reliability and safety of its systems, and enable the company to provide uninterrupted natural gas services to an increasing customer base.

In addition, NiSource’s large-scale modernization drive will prove to be a key performance catalyst over the long run. The company continues to invest in its Natural Gas operations and plans to spend about $1,000 million in 2016 as capital expenditure.

We note that a favorable regulatory environment in its service territories, along with a plethora of potential investment opportunities, position the company favorably for future growth.

NiSource currently carries a Zacks Rank #2 (Buy).

Other Stocks to Consider

Other well-ranked stocks in the same space include Avangrid, Inc. (NYSE:AGR) , Spark Energy, Inc. (NASDAQ:SPKE) and Avista Corporation (NYSE:AVA) . While Avangrid and Spark Energy sport a Zacks Rank #1 (Strong Buy), Avista has a Zacks Rank #2 (Buy).