The case for & against
Bull & Bear analysis
Bullish
Fortis Inc. (TSX: FTS) is a leading North American regulated utility holding company, delivering electric and gas services to approximately 3.4 million customers across Canada and the United States. The company is primarily engaged in regulated operations focused on infrastructure modernization, climate resilience, and transitioning to cleaner energy sources. With a strong emphasis on capital investments aimed at enhancing service reliability and supporting growing electricity demands, particularly from data centers, Fortis is positioning itself to tap into emerging energy trends and sustainable growth opportunities.
Bull says
- ↑52-year dividend growth; guidance of 4%-6% annual increases to 2030
- ↑Invested $1.4B in Q1; $28.8B five-year plan targeting 7% rate-base growth
- ↑Earnings yield ~27%; book/price 0.65; dividend yield 3.61%
- ↑Secured key regulatory approvals, including Springerville coal-to-gas conversion
- ↑Low volatility and positive momentum factors support stable returns
- ↑Rising AI and data-center demand underpins long-term electricity growth
Bear says
- ↓Negative profitability and revision scores signal margin pressure from capex
- ↓Complex multi-step regulatory approvals increase execution risk on $28.8B plan
- ↓Short interest ~56% reflects skepticism on capex and regulatory execution
- ↓Upward tariff pressure may squeeze cash flows and customer affordability
- ↓Negative growth and quality factor scores warn of potential underperformance
Earnings Call · Q1 2025 · Mgmt. Guidance
Updated 05-29-2026bullish
Transcript signals
Bull points
- During the quarter, we delivered safe and reliable service to our customers while successfully executing on our capital plan by investing $1.4 billion in our utility systems.
- Financially, we reported earnings per share of $1, representing a 7-cent increase over the same quarter last year.
- Our 2025 capital plan remains on track, with 27% invested in the first quarter. And with our $26 billion five-year capital plan focused on transmission investments at ITC, the resource transition in Arizona, and investments that strengthen our infrastructure and support customer growth across all of our utilities, we are positioned well to deliver on our growth strategy.
Bear points
- we are closely monitoring changes in government policies, including tariffs and their potential impacts on inflation, supply chain availability, and general economic conditions.
- Timing of operating costs, a lower allowed ROE of 8.97 effective January 1st, 2025, and the expiration of a PBR efficiency carryover mechanism at Fortis Alberta tempered growth quarter over quarter.
- And finally, higher weighted average shares lowered EPS by one cent driven by shares issued under our dividend reinvestment plan.
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