MDU Resources’ fourth quarter results fell short of Wall Street’s revenue and adjusted EBITDA expectations, prompting a negative market reaction. Management attributed the underperformance to higher operating costs, particularly in the electric utility segment, where increased payroll, contract services for generation station outages, and insurance expenses offset higher retail sales. CEO Nicole Kivisto highlighted customer growth and accelerated capital investment, including the early completion of the Badger Wind Farm acquisition, as key operational achievements. Management also pointed to robust performance in the pipeline business, noting increased demand for short-term transportation contracts and the successful execution of expansion projects.
Is now the time to buy MDU? Find out in our full research report (it’s free for active Edge members).
MDU Resources (MDU) Q4 CY2025 Highlights:
- Revenue: $534 million vs analyst estimates of $561.5 million (134% year-on-year growth, 4.9% miss)
- Adjusted EBITDA: $158.9 million vs analyst estimates of $172.1 million (29.8% margin, 7.7% miss)
- EPS (GAAP) guidance for the upcoming financial year 2026 is $0.97 at the midpoint, missing analyst estimates by 1%
- Operating Margin: 20.1%, up from 3.2% in the same quarter last year
- Market Capitalization: $4.19 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From MDU Resources’s Q4 Earnings Call
- Tanner from Jefferies asked for detail on the headwinds in the 2026 EPS guidance, with management citing partial impacts from pending rate cases and equity issuance as key factors in not meeting the long-term growth target this year.
- Tanner from Jefferies requested clarity on contract negotiations and the timeline for Bakken East pipeline progress. Nicole Kivisto explained the open season process, ongoing customer discussions, and that project timing depends on securing customer commitments and regulatory milestones.
- Analysts sought more information about the data center load ramp-up and potential impacts on capital allocation, with management reiterating a capital-light model and cautious approach to new investment until agreements are final.
- Questions were raised regarding the impact of the recent public equity offering on near-term EPS, with CFO Jason Vollmer clarifying that the share issuance will fund growth but dilute earnings until new projects generate returns.
- The team was asked about regulatory risk and the timeline for outcomes in Montana and Oregon rate cases. Management responded that decisions are expected over the coming year and are key to future earnings visibility.
Catalysts in Upcoming Quarters
Looking forward, the StockStory team will be monitoring (1) the outcomes of ongoing rate cases and regulatory filings, particularly in Montana and Oregon, (2) the pace at which contracted data center load ramps online and drives incremental demand, and (3) progress toward customer commitments and final investment decisions for major pipeline projects like Bakken East. Updates on capital allocation and cost discipline will also be important markers of execution.
MDU Resources currently trades at $20.53, down from $21.03 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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