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Today's Bonus Article
Why This Midwest Utility Is the Hottest Stock on Wall Street Right NowBy Chris Markoch. Published: 4/13/2026. 
Key Points
- NiSource is benefiting from rising Midwest data center demand tied to AI infrastructure growth.
- Natural gas is emerging as a near-term solution for hyperscalers needing reliable 24/7 power.
- NI remains in a strong uptrend, but valuation and momentum suggest a pullback may offer a better entry.
- Special Report: Elon Musk’s $1 Quadrillion AI IPO
In real estate, the mantra is location, location, location. That’s the principle behind the recent surge in NiSource (NYSE: NI) stock. NiSource is a utility company that has suddenly become one of the analyst community’s favorites. In fact, despite the firm being up 15% in 2026, KeyCorp recently raised its price target for NI — but is that a ceiling or a floor? On the surface, NiSource operates like a typical regulated utility, delivering natural gas and electricity to residential, commercial and industrial customers. What sets it apart right now is location: the company sits squarely in regions where the data center buildout is pushing into the nation’s heartland. NiSource Proves Why Location MattersThe bull case for NI isn’t complicated, but it deserves a clear explanation. Hyperscalers need dedicated data centers to house the servers and related equipment that power their artificial intelligence (AI) ambitions. That requires reliable, around-the-clock power.
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AI workloads are power-hungry, and the growing demand for data center capacity is colliding with an aging electrical grid that needs upgrades for many applications beyond data centers. Nuclear energy has re-emerged as part of the long-term solution, but new nuclear projects take years to come online. In the interim, natural gas has become the practical choice for meeting near-term demand. This has made natural gas the preferred fuel for many hyperscalers, and NiSource—with its existing infrastructure in key Midwest markets—could play a meaningful role. NiSource’s Midwest footprint is becoming strategically important for data centers for three reasons:
Cheaper land Cheaper power Available grid capacity KeyCorp’s analysis emphasizes that NiSource operates in jurisdictions with constructive regulatory environments, including relatively modest regulatory lag. That regulatory clarity gives customers and investors more cost certainty and helps NiSource generate stable, predictable earnings. Is NI Priced for Perfection?NI is up more than 15% in 2026, pushing its price-to-earnings ratio above 24x. That’s a premium to the broader market and its sector, though not an extreme one. Investors still need to consider whether recent gains already reflect the best of the company’s prospects. NI has been in a steady uptrend since bottoming near $38 last spring, producing a series of higher lows that suggest accumulation rather than speculation. The 50-day moving average—currently around $46—has acted as a reliable floor through several pullbacks, including a sharp but brief dip in early March that was quickly bought.  The stock closed on April 9 at $48.47, well above that moving average, which is a constructive sign. The 14-day RSI has climbed to the mid-60s, just below overbought territory; a signal reading around 53 confirms the broader uptrend is intact. The gap between those readings suggests the stock may need to digest recent gains before attempting the next leg higher. Volume has been relatively steady, without the climactic surge that often signals a top, which is mildly encouraging for bulls. Taken together, the chart implies NI is extended in the short term but not broken. A pullback toward the 50-day moving average near $46 would offer a more comfortable entry point for investors who believe the data center thesis has further to run. Why Utilities Like NiSource Are Gaining Investor AttentionA roughly 15% year-to-date gain for a regulated utility is uncommon, and momentum can swing quickly. Utilities often attract defensive flows, but that dynamic can reverse when risk appetite returns. Valuation is a legitimate concern, but context matters. Regulated utilities rarely trade at growth multiples unless the market sees a durable earnings catalyst. In NiSource’s case, the data center narrative could be that catalyst. If even a handful of hyperscaler agreements materialize in its core jurisdictions, future earnings could make a 24x multiple look reasonable in hindsight. That said, much of the easy money may already be made. Analysts have noticed the story: KeyCorp's raised price target is unlikely to be the last upgrade, but upgrades often cluster near peaks as well as inflection points. Investors who missed the initial move would be prudent to wait for a pullback rather than chase NI in extended territory. NiSource has earned its moment. Its Midwest footprint, constructive regulatory backdrop and natural gas infrastructure place it in the path of one of the most capital-intensive buildouts in recent technology history. Location, it seems, really does matter — the remaining question is how much of that advantage the market has already priced in. |
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