NorthWestern (NasdaqGS:NWE) - Share price, News & Analysis

NWE fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	1/6
Past Performance	5/6
Financial Health	1/6
Dividends	5/6

NWE Stock Overview

NorthWestern Corporation, doing business as NorthWestern Energy, provides electricity and natural gas to residential, commercial, and various industrial customers.

Rewards

Trading at 20% below our estimate of its fair value

Earnings are forecast to grow 6.27% per year

Earnings grew by 9.1% over the past year

Risk Analysis

Interest payments are not well covered by earnings

Dividend of 4.06% is not well covered by earnings

Significant insider selling over the past 3 months

Shareholders have been diluted in the past year

NorthWestern Competitors

Dominion Energy

NYSE:D

US$69.0b

Sempra

NYSE:SRE

US$52.2b

Consolidated Edison

NYSE:ED

US$35.6b

Public Service Enterprise Group

NYSE:PEG

US$34.3b

Price History & Performance

Summary of all time highs, changes and price drops for NorthWestern
Historical stock prices
Current Share Price	US$62.03
52 Week High	US$65.62
52 Week Low	US$53.66
Beta	0.47
1 Month Change	0.76%
3 Month Change	6.97%
1 Year Change	-1.93%
3 Year Change	-13.55%
5 Year Change	1.03%
Change since IPO	148.62%

Recent News & Updates

May 19

Is There An Opportunity With NorthWestern Corporation's (NASDAQ:NWE) 20% Undervaluation?

Today we will run through one way of estimating the intrinsic value of NorthWestern Corporation ( NASDAQ:NWE ) by...

Apr 12

NorthWestern Corporation: Little Utility On The Prairie

The utility NorthWestern Corporation is planning to invest more than $2 billion over the coming 5 five years in expanding its capacity and reducing its production shortfall. Debt loads are becoming an increasing point of concern in the utility sector, and NorthWestern was recently downgraded to BBB, with a stable outlook. In spite of the downgrade, NorthWestern's overall debt profile, valuation, and dividend make it a reasonable option in a defensive or income-focused portfolio.

Shareholder Returns

	NWE	US Integrated Utilities	US Market
7D	1.3%	2.0%	-4.0%
1Y	-1.9%	14.8%	-13.2%

Return vs Industry: NWE underperformed the US Integrated Utilities industry which returned 11.2% over the past year.

Return vs Market: NWE exceeded the US Market which returned -12.3% over the past year.

Price Volatility

Is NWE's price volatile compared to industry and market?
NWE volatility
NWE Average Weekly Movement	3.3%
Integrated Utilities Industry Average Movement	2.7%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	2.9%

Stable Share Price: NWE is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: NWE's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1923	1,483	Bob Rowe	https://www.northwesternenergy.com

NorthWestern Corporation, doing business as NorthWestern Energy, provides electricity and natural gas to residential, commercial, and various industrial customers. The company operates through Electric and Natural Gas segments. It generates, purchases, transmits, and distributes electricity; and produces, purchases, stores, transmits, and distributes natural gas, as well as owns municipal franchises to provide natural gas service in the communities.

NorthWestern Fundamentals Summary

How do NorthWestern's earnings and revenue compare to its market cap?
NWE fundamental statistics
Market Cap	US$3.36b
Earnings (TTM)	US$182.88m
Revenue (TTM)	US$1.37b

18.4x

P/E Ratio

2.5x

P/S Ratio

Is NWE overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NWE income statement (TTM)
Revenue	US$1.37b
Cost of Revenue	US$625.41m
Gross Profit	US$740.59m
Other Expenses	US$557.71m
Earnings	US$182.88m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	3.38
Gross Margin	54.22%
Net Profit Margin	13.39%
Debt/Equity Ratio	106.0%

How did NWE perform over the long term?

See historical performance and comparison

Dividends

4.1%

Current Dividend Yield

72%

Payout Ratio

Does NWE pay a reliable dividends?

See NWE dividend history and benchmarks

When do you need to buy NWE by to receive an upcoming dividend?
NorthWestern dividend dates
Ex Dividend Date	Jun 14 2022
Dividend Pay Date	Jun 30 2022
Days until Ex dividend	19 days
Days until Dividend pay date	35 days

Does NWE pay a reliable dividends?

See NWE dividend history and benchmarks

Valuation

Is NorthWestern undervalued compared to its fair value and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

20.0%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: NWE ($62.03) is trading below our estimate of fair value ($77.5)

Significantly Below Fair Value: NWE is trading below fair value, but not by a significant amount.

Price To Earnings Ratio

PE vs Industry: NWE is good value based on its Price-To-Earnings Ratio (18.4x) compared to the US Integrated Utilities industry average (23.6x).

PE vs Market: NWE is poor value based on its Price-To-Earnings Ratio (18.4x) compared to the US market (15.1x).

Price to Earnings Growth Ratio

PEG Ratio: NWE is poor value based on its PEG Ratio (2.9x)

Price to Book Ratio

PB vs Industry: NWE is good value based on its Price-To-Book Ratio (1.4x) compared to the US Integrated Utilities industry average (2.2x).

Future Growth

How is NorthWestern forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

6.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NWE's forecast earnings growth (6.3% per year) is above the savings rate (1.9%).

Earnings vs Market: NWE's earnings (6.3% per year) are forecast to grow slower than the US market (12.3% per year).

High Growth Earnings: NWE's earnings are forecast to grow, but not significantly.

Revenue vs Market: NWE's revenue (4% per year) is forecast to grow slower than the US market (7.8% per year).

High Growth Revenue: NWE's revenue (4% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: NWE's Return on Equity is forecast to be low in 3 years time (8.2%).

Past Performance

How has NorthWestern performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

0.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: NWE has high quality earnings.

Growing Profit Margin: NWE's current net profit margins (13.4%) are higher than last year (13.3%).

Past Earnings Growth Analysis

Earnings Trend: NWE's earnings have grown by 0.5% per year over the past 5 years.

Accelerating Growth: NWE's earnings growth over the past year (9.1%) exceeds its 5-year average (0.5% per year).

Earnings vs Industry: NWE earnings growth over the past year (9.1%) exceeded the Integrated Utilities industry 6.6%.

Return on Equity

High ROE: NWE's Return on Equity (7.7%) is considered low.

Financial Health

How is NorthWestern's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NWE's short term assets ($398.8M) do not cover its short term liabilities ($409.4M).

Long Term Liabilities: NWE's short term assets ($398.8M) do not cover its long term liabilities ($4.0B).

Debt to Equity History and Analysis

Debt Level: NWE's net debt to equity ratio (105.4%) is considered high.

Reducing Debt: NWE's debt to equity ratio has reduced from 118.4% to 106% over the past 5 years.

Debt Coverage: NWE's debt is not well covered by operating cash flow (14%).

Interest Coverage: NWE's interest payments on its debt are not well covered by EBIT (2.8x coverage).

Balance Sheet

Dividend

What is NorthWestern current dividend yield, its reliability and sustainability?

Dividend Score

6/6

Dividend Score 6/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

4.06%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: NWE's dividend (4.06%) is higher than the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: NWE's dividend (4.06%) is in the top 25% of dividend payers in the US market (4.05%)

Stability and Growth of Payments

Stable Dividend: NWE's dividends per share have been stable in the past 10 years.

Growing Dividend: NWE's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (71.6%), NWE's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: NWE is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

10.2yrs

Average management tenure

CEO

Bob Rowe (65 yo)

13.75yrs

Tenure

US$3,445,367

Compensation

Mr. Robert C. Rowe, also known as Bob, Esq., has been the Chief Executive Officer of Northwestern Corporation since August 2008 and was its President since August 2008 until February 05, 2021. Mr. Rowe ser...

CEO Compensation Analysis

Compensation vs Market: Bob's total compensation ($USD3.45M) is below average for companies of similar size in the US market ($USD6.83M).

Compensation vs Earnings: Bob's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: NWE's management team is seasoned and experienced (10.2 years average tenure).

Board Members

Experienced Board: NWE's board of directors are considered experienced (5.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: NWE insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6.8%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/24 00:00
End of Day Share Price	2022/05/24 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31