How Fortis’s Rising Q2 Earnings May Shape the Long-Term Outlook for Investors (TSX:FTS)

• Fortis Inc. recently reported its second-quarter 2025 results, with sales rising to CA$2.82 billion and net income reaching CA$404 million, both increases compared to the same period last year.
• This improvement in earnings and profitability highlights Fortis's effective execution in a period of ongoing capital investment and industry transformation.
• We'll explore how Fortis's substantial net income growth this past quarter may influence its long-term investment narrative and outlook.

Find companies with promising cash flow potential yet trading below their fair value.

Fortis Investment Narrative Recap

To be a Fortis shareholder, you'd need confidence in the utility’s ability to steadily invest in regulated infrastructure while managing regulatory hurdles and capital costs. The recent Q2 results, showing higher sales and net income, reinforce near-term earnings strength but do not meaningfully alter the central catalyst, execution of its ambitious capital plan, and the key risk around regulatory delays and rising interest expenses remains unchanged for now. Of the latest announcements, the July 31 dividend affirmation is most relevant given the company’s consistent cash flow and profit growth. Reliable dividends, even as major investments continue, reflect Fortis’s focus on balance sheet stability, a theme closely tied to its ability to follow through on capital projects that drive rate base and future earnings expansion. Yet, despite the improving bottom line and regular dividend, investors should pay close attention to growing leverage and the pressures this could place on Fortis if borrowing costs rise...

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

Fortis' narrative projects CA$13.8 billion revenue and CA$2.1 billion earnings by 2028. This requires 5.2% yearly revenue growth and a CA$0.4 billion earnings increase from CA$1.7 billion.

Uncover how Fortis' forecasts yield a CA$67.75 fair value, a 3% downside to its current price.

Exploring Other Perspectives

Fair value estimates from three Simply Wall St Community members stretch from CA$58.05 to CA$300.94 per share. Amid this spectrum, Fortis’s large capital program remains in focus as a key test for earnings sustainability and long-term financial resilience, prompting you to compare your outlook with those of fellow market participants.

Explore 3 other fair value estimates on Fortis - why the stock might be worth 17% less 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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