NiSource (NI) Prices $2B Senior Notes to Refinance Debts
NiSource Inc. NI announced the pricing of $2 billion senior notes, expected to close on Aug 18 and are subject to customary closing conditions.
The company priced 0.950% senior notes of an aggregate principal amount worth $1.25 billion due 2025 while 1.700% senior notes worth $0.75 billion aggregate principal amount due 2031.
The company expects to use the net proceeds to pay the purchase price and the costs related to its certain outstanding debt securities. Also, it will prepay all its outstanding privately placed 5.89% Series D senior notes due Nov 28, 2025. NiSource plans to use any remaining aggregate net proceeds for general corporate purposes.
Liquidity Position
NiSource’s long-term debts (excluding amounts due within a year) as of Jun 30 were $8,810.2 million compared with $7,856.2 million as of Dec 31, 2019. The company exited the second quarter with nearly $2 billion net available liquidity, which is adequate enough to meet its debt obligations.
NiSource’s aforementioned strategic move taps the opportunity of the prevalent low-interest rate scenario to refinance its older high-interest bearing debt with proceeds from lower-interest carrying debts, resulting in annual interest savings. Also, the company has been able to preserve liquidity by pushing its maturity period forward. At a time when every entity is looking to conserve its cash box amid uncertainties triggered by the COVID-19 outbreak, NiSource’s recent decision will position it well to deal with the ongoing crisis.
Zacks Rank & Price Performance
Currently, the stock carries a Zacks Rank #4 (Sell).
In the past six months, shares of the company have declined 19.4% compared with the industry’s fall of 18%.
Stocks to Consider
A few better-ranked electric utilities are Portland General Electric Company POR, Korea Electric Power Corporation KEP and Huaneng Power International, Inc. HNP, all carrying a Zacks Rank#2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Portland General Electric Company delivered an earnings surprise of 7.74%, on average, in the last four quarters. The company has a long-term (three-five years) earnings growth rate of 5.14%.
Korea Electric Power has a long-term earnings growth rate of 5%. The Zacks Consensus Estimate for 2020 earnings has been steady in the past 60 days.
Huaneng Power International has a long-term earnings growth rate of 13.14%. The Zacks Consensus Estimate for current-year earnings has been revised 24.4% upward in the past 60 days.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through Q2 2020, while the S&P 500 gained an impressive +44.0%, five of our strategies returned +50.9%, +93.8%, +122.2%, +153.0%, and even +156.8%.
This outperformance has not just been a recent phenomenon. From 2000 – Q2 2020, while the S&P averaged +5.5% per year, our top strategies averaged up to +51.7% per year.
See their latest picks free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
NiSource, Inc (NI) : Free Stock Analysis Report
Korea Electric Power Corporation (KEP) : Free Stock Analysis Report
Portland General Electric Company (POR) : Free Stock Analysis Report
Huaneng Power International, Inc. (HNP) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
