Did Earnings Guidance Upgrade Just Shift National Grid's (LSE:NG.) Investment Narrative?

• National Grid reported half year results to 30 September 2026 with sales of £8,138 million, net income of £1,343 million and basic EPS from continuing operations of £0.269. The company also increased capital investment and lifted full year underlying EPS growth guidance to 15% to 16% for 2026/27.
• The earnings update underscored how higher allowed revenue in UK electricity transmission and a multi year investment plan of at least £70 billion are shaping National Grid's ability to fund grid upgrades while still supporting an inflation linked dividend policy.
• We will now look at how National Grid's upgraded earnings guidance could influence the existing investment narrative around its regulated growth.

Compare National Grid's regulated income profile with other grid and infrastructure plays by scanning the hand picked 40 power grid technology and infrastructure stocks that echo this earnings and investment story.

National Grid Investment Narrative Recap

To own National Grid, you need to believe that a larger regulated asset base and long term grid investment plan can be matched by supportive regulators in the UK and US. The latest half year, with higher sales, earnings and an uplift to underlying EPS guidance for 2026/27, reinforces that the plan is currently being executed. The key short term catalyst is how regulators treat rising capex and allowed returns.

The biggest near term risk sits on the same fault line. Affordability pressure and the next stages of RIIO T3 and US rate processes could limit returns or slow cost recovery, especially with debt and dividends leaning on cash flows. Recent guidance looks encouraging but does not remove that regulatory overhang.

The most relevant update is the upgraded full year underlying EPS growth guidance of 15% to 16% for 2026/27, alongside capital investment that rose by about one third in the first half. This links directly to the £70b plus plan through FY31 and shows National Grid leaning into projects in UK transmission and US networks.

For you as an investor, the question is whether execution on that spend can stay aligned with allowed returns while managing real world issues such as summer heat related outages in UK Electricity Distribution. If regulators stay focused on reliability and system reinforcement, those projects can remain a core operational catalyst, while tighter consumer cost pressure could be the brake.

National Grid's current set of analyst assumptions points to revenues of £22.9 billion and earnings of £5.4 billion by 2029, based on 9.0% yearly revenue growth and an earnings increase of about £2.2 billion from £3.2 billion today.

Uncover why National Grid's fair value indicates a 3% potential upside to its current price that could narrow quickly.

Exploring Other Perspectives

Four fair value estimates from the Simply Wall St Community cluster tightly between £12.99 and £13.27, so retail views on National Grid look fairly aligned rather than stretched. Those figures pre date the latest earnings beat and upgraded EPS guidance. You should weigh them against fresh regulatory risks and the larger £70b capital plan, then explore how other community members frame that trade off.

Explore 3 other National Grid fair value estimates, including one that suggests it could be worth as much as £13.26.

Form Your Own Verdict

Don't just follow the ticker; dig into the data and build a conviction that's truly your own.

• A great starting point for your National Grid research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• See our latest analysis for National Grid. The report includes a comprehensive fundamental analysis summarized in a single visual, the Snowflake, making it easy to evaluate National Grid's overall financial health at a glance.

Looking for more investment ideas beyond National Grid?

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