UPDATE: Credit Suisse Upgrades NiSource (NI) to Outperform

(Updated - September 30, 2014 10:41 AM EDT)

Credit Suisse upgraded NiSource (NYSE: NI) from Neutral to Outperform with a price target of $50.00 (from $41).

Analyst John Edwards said, "With NI only taking its EPS growth trajectory down by 100bp to 4-6% after the separation of Columbia Pipeline Group which has ~$700mm in 2015E EBITDA, it's clear NI's growth prospects are rising and difficult to see downside to the outlook. CPG is expected to invest $12-$15b over the next 10 years which should support double digit EBITDA growth."

"We are valuing NI shares based on sum of the parts for now. We note that with $1.2B+ being invested at Columbia Op Co, mid-teens growth is sustainable for the next 5 to 10 years. Thus we are raising the multiple on 2015E EBITDA to the 14-15x range giving us a TP on all NI of $50. Together with the NTM dividend, gives a total return potential of over 25%, supportive of a relative O/P. We have given no credit for NI EPS growth falling by only 100bp despite the spin next year which suggests accelerating growth at the utility," he added.

For an analyst ratings summary and ratings history on NiSource click here. For more ratings news on NiSource click here.

Shares of NiSource closed at $40.84 yesterday.

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