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Canada's Fortis Q3 profit beats estimates on rate base growth; raises dividend

By Reuters News


Overview

  • Canada regulated utility's Q3 adjusted EPS and adjusted net income beat analyst expectations

  • Company increased quarterly dividend by 4% and extended annual dividend growth guidance

  • Released C$32.2 bln five-year capital plan, up C$3.4 bln, supporting 7.5% rate base growth


Outlook

  • Fortis expects 2026 capital expenditures of C$6.0 bln, up from C$5.6 bln previously anticipated

  • Company unveils C$32.2 bln capital plan for 2027-2031, supporting 7.5% five-year rate base growth

  • Fortis extends annual dividend growth guidance of 4-6% through 2031


Result Drivers

  • RATE BASE GROWTH - Co said higher Q3 net earnings were mainly driven by growth in rate base across its utilities

  • UNS ENERGY PERFORMANCE - Higher earnings at UNS Energy reflected growth in retail electricity sales and timing of operating costs

  • DISPOSITIONS IMPACT - Dispositions of FortisTCI and Fortis Belize and higher holding company finance costs unfavourably impacted earnings growth


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Adjusted EPS

Beat

C$0.92

C$0.88 (12 Analysts)

Q3 EPS

C$0.92

Q3 Net Income attributable

Beat

C$474 mln

C$462 mln (4 Analysts)


Analyst Coverage

  • The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 6 "strong buy" or "buy", 7 "hold" and 2 "sell" or "strong sell"

  • The average consensus recommendation for the electric utilities peer group is "buy."

  • Wall Street's median 12-month price target for Fortis Inc. is C$84.00, about 1.3% above its November 2 closing price of C$82.95

  • The stock recently traded at 22 times the next 12-month earnings vs. a P/E of 21 three months ago


Reuters Recommended Reads

  • Nov 2 - Canada's Capital Power Q3 revenue falls on derivative losses

  • Nov 2 - Canada's Gibson Energy Q3 adjusted EBITDA beats estimates, hits record

  • Nov 2 - Entergy Q3 profit beats estimates on retail sales; raises dividend


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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