National Grid reported first-half operating profit of GBP 2.3 billion, exceeding expectations and up 12% from last year. US regulated businesses led the results, with a 46% increase in half-year operating profit. The UK Electricity Transmission segment also saw growth, with operating profit up 17% year over year to GBP 846 million.

Investment in the UK Electricity Transmission segment accounted for most of National Grid’s first-half investment, totaling GBP 1.7 billion. Morningstar maintains a fair value estimate of GBX 1,100 and a no-moat rating for National Grid. The upgraded guidance suggests fiscal 2026 EPS of GBX 78.4, ahead of Morningstar’s 75.0 GBX expectation.

Ofgem’s final determination for allowed returns under the RIIO-3 regulatory regime is expected by year-end. The draft points to an average real return on equity of around 5.6%, in line with Morningstar’s estimates. Morningstar’s analysis was originally published as a stock note by Morningstar Equity Research.

Read more at Morningstar: National Grid Earnings: Strong US Performance Drives EPS Guidance Raise, Shares Fairly Valued