Fortis’s CA$750 Million Debt Offering Could Be a Game Changer for Fortis (TSX:FTS)

• On September 4, 2025, Fortis Inc. closed a significant private placement, issuing CA$750 million in 5.100% fixed-to-fixed rate subordinated notes due December 2055 through a syndicate of agents, with proceeds designated for reducing corporate credit facility borrowings and supporting general corporate purposes.
• This large-scale debt financing signals Fortis’s ongoing focus on optimizing its capital structure and highlights investor interest in the company’s long-term financing activities.
• Let's explore how Fortis's sizeable debt placement could impact its investment narrative, particularly its capital allocation and growth prospects.

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Fortis Investment Narrative Recap

To be a Fortis shareholder, the big picture centers on belief in steady, regulated utility growth, reliable dividends, and disciplined capital management. The recent CA$750 million private placement reinforces Fortis’s long-term funding flexibility but does not materially alter the company’s main short-term catalyst, the ongoing expansion of electricity demand and large infrastructure projects, nor does it directly reduce Fortis’s exposure to its largest current risk: higher debt service costs as capital expenditures and interest rates rise.

The just-announced dividend payment of CA$0.615 per common share, payable September 1, 2025, remains at the heart of Fortis’s appeal. For investors watching capital allocation and cash flows, this declared payout reaffirms management’s intention to maintain Fortis’s steady dividend growth profile, even as new debt supports infrastructure investment and balance sheet optimization.

Yet, despite Fortis’s prudent debt moves, investors should be mindful of the pressure that rising interest payments could have on future earnings and dividends...

Read the full narrative on Fortis (it's free!)

Fortis' outlook points to CA$13.8 billion in revenue and CA$2.1 billion in earnings by 2028. To reach these figures, analysts anticipate 5.2% annual revenue growth and a CA$0.4 billion increase in earnings from the current CA$1.7 billion level.

Uncover how Fortis' forecasts yield a CA$68.06 fair value, in line with its current price.

Exploring Other Perspectives

Fair value opinions from 3 Simply Wall St Community members range from CA$58.05 to CA$305.56 per share. With ongoing capital investment needs highlighted in recent debt activity, these contrasting outlooks reflect how future financing costs may shape long-term performance and invite you to compare differing views.

Explore 3 other fair value estimates on Fortis - why the stock might be worth over 4x more than the current price!

Build Your Own Fortis Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Fortis research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Fortis research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Fortis' overall financial health at a glance.

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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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