NiSource Declares Common and Preferred Stock Dividends

Rhea-AI Summary

NiSource Inc. (NI) announced a quarterly common stock dividend of $0.265 per share and a dividend of $406.25 per share on the Corporation's 6.50% Series B Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock. The common stock dividend is payable on February 20, 2024, and the preferred stock dividend is payable on March 15, 2024.

Insights

Financial Analyst

The declaration of a quarterly common stock dividend by NiSource Inc. indicates the company's continued commitment to returning value to shareholders. The specific dividend of $0.265 cents per share is a tangible distribution of profits and can be seen as a signal of the company's financial health and stability. Investors often view regular dividend payments as a positive attribute, suggesting predictable cash flows and a mature business model.

From a financial analysis perspective, the dividend yield, calculated by dividing the annual dividend per share by the stock's price, is a critical metric for income-focused investors. Comparing NiSource's yield to industry benchmarks and its historical dividend patterns can provide insights into its attractiveness relative to peers and its potential impact on the stock's performance.

Moreover, the declared dividend on the preferred stock suggests NiSource is servicing its obligations to preferred shareholders, which is crucial as these dividends are typically cumulative and must be paid out before common stock dividends. The fixed-rate reset feature indicates that the dividend rate is subject to change, which can impact the desirability of these securities depending on interest rate movements.

Market Research Analyst

Assessing the broader market implications of NiSource's dividend announcement requires understanding the utility sector's dynamics. Utilities are known for their defensive investment characteristics, often maintaining stable dividends even in volatile markets. NiSource's ability to sustain its dividend payments could be indicative of operational efficiency and a robust regulatory environment that allows for predictable revenue streams.

Investors often look to utility companies like NiSource during times of economic uncertainty for their relative safety and consistent dividend payments. However, the sector's performance is also tied to interest rates; as rates rise, utility stocks may become less attractive compared to fixed-income alternatives. Thus, the reset feature on the preferred stock dividend becomes particularly relevant, as it adjusts the payout in response to changing interest rates.

Understanding the utility sector's regulatory framework is also vital, as it can significantly impact profitability and, consequently, the ability to pay dividends. Any shifts in regulatory policy or energy pricing can affect NiSource's future dividend-paying capacity.

Economist

The dividend declaration by NiSource must be contextualized within the broader economic environment. Dividend payments are not only a distribution of profits but also a reflection of a company's capital allocation strategy. In an environment where capital investment opportunities are abundant, a company may opt to reinvest profits rather than pay dividends. Conversely, NiSource's choice to pay dividends could imply a mature industry with limited high-return investment opportunities, or a strategic decision to maintain investor confidence through cash returns.

Inflationary pressures and interest rate policies play a significant role in the valuation of dividend-paying stocks. Higher inflation can erode the real value of dividend payments, while higher interest rates can lead to a reevaluation of the risk-reward profile of dividend stocks versus bonds. The fixed-rate reset feature on NiSource's preferred stock addresses this to some extent by allowing the dividend rate to adjust over time, potentially mitigating the impact of inflation and interest rate changes on investor returns.

MERRILLVILLE, Ind.--(BUSINESS WIRE)-- The board of directors of NiSource Inc. (NYSE: NI) today declared a quarterly common stock dividend payment of $0.265 cents per share, payable February 20, 2024, to stockholders of record at the close of business on February 5, 2024.

The board also declared today a dividend of $406.25 per share on the Corporation's 6.50% Series B Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, equal to $0.40625 per depositary share, each representing a 1/1000th interest in a share of the Series B Preferred Stock, is hereby declared, payable March 15, 2024, to stockholders of record at the close of business on February 23, 2024.

About NiSource

NiSource Inc. (NYSE: NI) is one of the largest fully-regulated utility companies in the United States, serving approximately 3.3 million natural gas customers and 500,000 electric customers across six states through its local Columbia Gas and NIPSCO brands. The mission of our approximately 7,200 employees is to deliver safe, reliable energy that drives value to our customers. NiSource is a member of the Dow Jones Sustainability - North America Index, has been named as one of TIME Magazine’s World’s Best Companies and is on Forbes list of America’s Best Employers for Diversity. Learn more about NiSource’s record of leadership in sustainability, investments in the communities it serves and how we live our vision to be an innovative and trusted energy partner at www.NiSource.com. NI-F

View source version on businesswire.com: https://www.businesswire.com/news/home/20240125469089/en/

Media

Lynne Evosevich

Corporate Media Relations

(724) 288-1611

levosevich@nisource.com

Investors

Christopher Turnure

Director, Investor Relations

(614) 404-9426

cturnure@nisource.com

Source: NiSource Inc.

FAQ

What is the quarterly common stock dividend announced by NiSource Inc. (NI)?

The quarterly common stock dividend announced by NiSource Inc. (NI) is $0.265 per share, payable on February 20, 2024.

What is the dividend announced for the Corporation's 6.50% Series B Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock?

The dividend announced for the Corporation's 6.50% Series B Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock is $406.25 per share, payable on March 15, 2024.

When are the dividends payable to stockholders of record?

The common stock dividend is payable to stockholders of record at the close of business on February 5, 2024, and the preferred stock dividend is payable to stockholders of record at the close of business on February 23, 2024.