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what it is
Black Hills sells electricity and natural gas to homes and businesses across the Midwest and Mountain West.
how it gets paid
Last year Black Hills made $2.3B in revenue. commercial electric sales was the main engine at $0.87B, or 38% of sales.
why it's growing
Revenue grew 9.0% last year. EDGAR shows quarterly revenue of $1.7 billion, up 289% vs. prior year, and EPS up 659%.
what just happened
Latest quarter EPS came in at $2.58, but the most recent reported quarter also missed consensus at the margin.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
100/100 earnings predictability — you can trust these numbers
16.9x trailing p/e — the market's not buying it — or you found a deal
3.9% dividend yield — cash in your pocket every quarter
4.0% return on capital — nothing to write home about
xvary composite: 73/100 — average
What they do
Black Hills sells electricity and natural gas to homes and businesses across the Midwest and Mountain West.
This is a regulated utility, which means state-approved service territories → protected local monopoly → your power bill usually goes to them, not a rival. Black Hills serves 222,340 electric customers and 1.12 million gas customers, so the customer base is sticky because switching your utility is basically not a thing.
How they make money
$2.3B
annual revenue · their business grew +9.0% last year
commercial electric sales
$0.87B
residential electric sales
$0.78B
industrial electric sales
$0.53B
other electric revenue
$0.12B
The products that matter
electric generation and delivery
regulated electric service
222,340 customers · about $1.4B revenue
it served 222,340 electric customers and generated about $1.4B in revenue last year. this is the capital-heavy side of the business, where grid work and rate recovery do most of the earnings work.
largest segment
gas distribution
regulated natural gas service
1M+ customers · about $0.9B revenue
it serves more than 1 million gas customers and brings in about $0.9B in annual revenue. the customer count is larger than electric, but the revenue base is smaller.
broad customer base
transmission expansion
ready wyoming project
260 miles · largest project in company history
this 260-mile transmission build is near the finish line and is the largest electric transmission project in company history. for you as a shareholder, that matters because finished utility assets become future rate-base arguments.
capital plan proof
Key numbers
3.9%
dividend yield
Dividend yield → annual cash payout as a share of the stock price → so what: you are getting paid while you wait, but you are also buying a stock with only modest upside.
$4.3B
long-term debt
That debt load is huge next to a roughly $5 billion market cap, which means financing costs matter almost as much as operations.
4.0%
return on capital
Return on capital → profit earned on money invested in the business → so what: this is a low-return company, even by utility standards.
16.9x
trailing p/e
You are paying 16.9 times trailing earnings for a business with projected sales growth of 1.5%, which is not exactly a bargain-bin setup.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 2 — safer than 80% of stocks
- price stability 90 / 100
- long-term debt $4.3B (45% of capital)
- return on equity 8% — $0.08 profit for every $1 investors have put in
B++ — risk rank looks solid but long-term debt needs watching.
Total return vs. market
You invested $10,000 in BKH 3 years ago → it's now worth $11,320.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
Latest quarter EPS came in at $2.58, but the most recent reported quarter also missed consensus at the margin.
EDGAR shows quarterly revenue of $1.7 billion, up 289% vs. prior year, and EPS up 659%. But Yahoo consensus says the last earnings print was $1.39 versus a $1.40 estimate, a 0.71% miss, which is a very utility way to disappoint.
$1.7B
revenue
$2.58
eps
26.24%
gross margin
the number that mattered
The key number is the 0.71% miss versus estimates, because this stock sells stability, not surprises.
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in october, the companies filed joint applications for approval of the transaction with regulatory commissions in montana, nebraska and south dakota, to be imminently followed by an application with the federal energy regulatory commission.we expect the transaction to close in the second half of 2026, subject to shareholder and regulatory approvals. the combined entity will possess greater scale and balance sheet grade to deliver for customers while accelerating energy and grid infrastructure investment in arkansas, colorado, iowa, kansas, montana, nebraska, south dakota, and wyoming.
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black hills likely completed 2025 with a steady earnings gain.through the september interim, year-to-date adjusted earnings per share of $2.70 benefited from new rates and rider recovery of $0.68 a share, more than offsetting increases in operating and finance expenses. constructive and timely outcomes of utility regulatory dockets, along with normal weather conditions within utility service territories, likely facilitated a mid-single-digit bottom-line increase for the full year.
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the company is nearing completion of its ready wyoming transmission project.
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at approximately 260 miles in length, the endeavor represents the largest electric transmission project in company history, interconnecting black hills’ wyoming and south dakota electric systems.the project is designed to maintain long-term cost stability for customers while enhancing system resiliency and supporting local economic growth through the development of wyoming’s significant wind and solar natural resources.
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given the pending merger, black hills’ outlook rank remains suspended.although subject to board approval, we expect black hills to continue paying its appealing dividend yield until the transaction is finalized.
source: company earnings report, 2026
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What could go wrong
the top risk is rate-case friction on a $4.7B spending plan.
high
rate case pushback
black hills needs regulators to approve higher customer rates so it can earn on a $4.7B spending plan. a key south dakota request for $50.6M of annual revenue is still on the watch list.
black hills secured $52M in new annual revenue from three rate reviews last year. if new asks land below request, the earnings story slows fast.
med
pending merger friction
the all-stock deal still needs shareholder and regulatory approval, with management aiming for the second half of 2026 for close.
until then, you own a utility and a deal process at the same time. that is why the outlook rank is suspended and why some investors are waiting for a cleaner setup.
med
debt load and financing costs
long-term debt stands at $4.3B, or 45% of capital. utilities can carry debt, but large project plans get less forgiving when funding costs stay high.
this looks manageable now. it gets tighter if cost recovery slows while the company still needs cash for big projects.
med
weather moving off normal
management's recent outlook leans on normal weather across its service territories. utilities do not control weather, but usage and margin still feel it.
if weather turns less cooperative, even a 100/100 predictability story can post a messier path than investors expect.
a $4.7B spending plan against a market cap near $5B and $4.3B of debt leaves little room for a hostile rate cycle.
source: institutional data · regulatory filings · risk analysis
Pay attention to
regulatory
south dakota rate outcome
a decision tied to the $50.6M annual revenue request is expected in Q3 2026. this is the cleanest live test of whether regulators stay constructive.
earnings calendar
Q1 2026 earnings
report due may 6, 2026. consensus expects $2.01 in EPS. you want guidance held more than you want a one-quarter beat.
project execution
ready wyoming completion
the 260-mile transmission project is near the finish line. completion matters because finished infrastructure becomes rate-base support.
deal process
merger approvals
the pending transaction still needs state and federal approvals, with management aiming for the second half of 2026. until you get that answer, part of the stock story sits outside normal utility math.
Analyst rankings
earnings predictability
100 / 100
management has been unusually consistent. in human-speak: this is the opposite of an earnings surprise stock.
risk rank
2
risk rank 2 means it has behaved safer than most stocks. you buy a utility for that kind of calm, and black hills has mostly delivered it.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 215 buyers vs. 171 sellers in 3q2025. total institutional holdings: 67.0M shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$48
$81
$69
current price
$65
target midpoint · 6% from current · 3-5yr high: $90 (+30% · 10% ann'l return)
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