Fortis (TSX:FTS) Valuation Check After Capital Plan Boost, Earnings Growth and Dividend Increase

Fortis (TSX:FTS) is back in the spotlight after Q3 results showed rate base growth humming along, an 11% bump in its multi year capital plan, and another uptick in the dividend.

See our latest analysis for Fortis.

Those steady updates on capital spending and dividends seem to be filtering into the market, with Fortis’s share price at $69.25 and a robust year to date share price return of 16.15%, translating into a 19.35% one year total shareholder return and signalling gradually improving momentum for a traditionally defensive utility.

If Fortis’s mix of stability and growth has you thinking bigger picture, this could be a good moment to explore fast growing stocks with high insider ownership for other compelling ideas with strong alignment between management and shareholders.

With earnings still grinding higher, a bigger capital plan in place, and the dividend marching upward, is Fortis quietly trading below its true value, or are investors already paying up for that future growth?

Most Popular Narrative: 5.3% Undervalued

With Fortis last closing at CA$69.25 against a narrative fair value of CA$73.10, the storyline leans toward modest upside driven by regulated growth.

Substantial planned capital investments in grid modernization, renewable energy integration, and battery storage (e.g., $2.9B invested in H1 2025 and upcoming projects at ITC and FortisBC) position the company to benefit from policy-driven infrastructure upgrades and decarbonization mandates, supporting above-average asset base growth and improved earnings visibility.

Read the complete narrative.

Want to see what powers that upside view? The narrative quietly stacks revenue growth, margin expansion and a richer profit multiple into one long term playbook. Curious how those pieces fit together, and what they imply for earnings a few years from now? Dive in to uncover the full valuation blueprint behind that fair value.

Result: Fair Value of $73.10 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that blueprint could unravel if regulators push back on rate hikes or if higher interest costs erode returns on Fortis’s expanded capital plan.

Find out about the key risks to this Fortis narrative.

Another View: Market Multiples Look Less Generous

Step away from that 5.3% upside story and a simple earnings multiple paints a tougher picture. Fortis trades on about 20.6x earnings, richer than the North American utilities sector at 19.9x and its own 20.5x fair ratio, which hints at limited margin for error if growth disappoints.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Fortis Narrative

If you see things differently or just like digging into the numbers yourself, you can spin up a fresh narrative in minutes with Do it your way.

A great starting point for your Fortis research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

Ready for your next investing move?

Before you lock in any decision on Fortis, put its story in context by lining it up against fresh ideas from the Simply Wall St Screener today.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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