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NWE, NorthWestern Energy

Multi-Utilities capital-intensive Regulated utility

NorthWestern Energy - Delivering a Bright Future NorthWestern Energy Group, doing business as NorthWestern Energy, provides essential energy infrastructure and valuable services that enrich lives and empower communities while serving as long-term partners to our customers and communities.

We work to deliver safe, reliable, and innovative energy solutions that create value for customers, communities, employees, and investors.

We do this by providing low-cost and reliable service performed by highly-adaptable and skilled employees.

Latest annual: FY2025 10-K

NWE · NorthWestern Energy

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$1.6B

+6.4% YoY · 4% 4-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $1.6B 5-yr avg $1.5B

Operating margin 19.2% 5-yr avg 20.1%

ROIC 5% 5-yr avg 6%

Owner-earnings margin −9% 5-yr avg −11%

Free cash flow margin −9% 5-yr avg −11%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Regulated utility. Returns are set by regulation on an approved rate base; the capital spending regulators approve becomes the growth, recovered through allowed rates.
What moves the needle: Operating margin has run about 20% through the cycle, a solid margin the cost base and competition set as much as the price does. That margin has held in a narrow 18%–21% band over the years, so steadiness itself is the evidence — the lever is unit growth and cost discipline, not a moving line. Capital spending runs about 35% of sales, well above depreciation, so the return earned on what it sinks into that plant weighs as much as the margin. Read this kind of business on rate base and the allowed return. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 5%, above 15% in 0 of 5 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2021–2025

realized figures from each filing · older years to the left

2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
						Income statement
$1.4B	$1.5B	$1.4B	$1.5B	$1.6B	$1.6B	RevenueRevenue
7%	8%	8%	9%	10%	10%	SG&A / revenueSG&A/rev
$276M	$263M	$300M	$323M	$326M	$315M	Operating incomeOp. inc.
20.1%	17.8%	21.1%	21.4%	20.2%	19.2%	Operating marginOp. mgn
$187M	$183M	$194M	$224M	$181M	$168M	Net incomeNet inc.
2%	-0%	4%	-4%	3%	3%	Effective tax rateTax rate
						Cash flow & returns
$220M	$307M	$489M	$407M	$394M	$400M	Operating cash flowOp. cash
$187M	$195M	$210M	$228M	$250M	$254M	DepreciationDeprec.
($160M)	($76M)	$79M	($50M)	($43M)	($28M)	Working capital & otherWC & other
$434M	$515M	$567M	$549M	$524M	$548M	CapexCapex
31.6%	34.9%	39.9%	36.3%	32.6%	33.4%	Capex / revenueCapex/rev
($214M)	($208M)	($78M)	($143M)	($130M)	($148M)	Owner earningsOwner earn.
−15.6%	−14.1%	−5.5%	−9.4%	−8.1%	−9.0%	Owner earnings marginOE mgn
($214M)	($208M)	($78M)	($143M)	($130M)	($148M)	Free cash flowFCF
−15.6%	−14.1%	−5.5%	−9.4%	−8.1%	−9.0%	Free cash flow marginFCF mgn
—	—	$0	$0	$36M	$36M	AcquisitionsAcquis.
$128M	$140M	$154M	$159M	$161M	$162M	Dividends paidDiv. paid
12%	5%	5%	6%	5%	5%	ROICROIC
8%	7%	7%	8%	6%	6%	Return on equityROE
2%	2%	1%	2%	1%	0%	Retained to equityRetained/eq
						Balance sheet
$3M	$8M	$9M	$4M	$9M	$6M	Cash & investmentsCash+inv
—	$245M	$212M	$188M	$210M	$199M	ReceivablesReceiv.
—	$107M	$115M	$123M	$133M	$134M	InventoryInvent.
—	$201M	$124M	$112M	$130M	$122M	Accounts payablePayables
—	$151M	$202M	$199M	$213M	$212M	Operating working capitalOper. WC
—	$539M	$407M	$418M	$504M	$513M	Current assetsCur. assets
—	$621M	$535M	$802M	$697M	$731M	Current liabilitiesCur. liab.
—	0.9×	0.8×	0.5×	0.7×	0.7×	Current ratioCurr. ratio
—	$358M	$358M	$358M	$368M	$368M	GoodwillGoodwill
$6.8B	$7.3B	$7.6B	$8.0B	$8.5B	$8.6B	Total assetsAssets
—	$2.6B	$2.8B	$3.0B	$3.3B	$3.3B	Total debtDebt
—	$2.6B	$2.8B	$3.0B	$3.3B	$3.3B	Net debt / (cash)Net debt
2.9×	2.6×	2.6×	2.5×	2.2×	2.1×	Interest coverageInt. cov.
$2.3B	$2.7B	$2.8B	$2.9B	$2.9B	$2.9B	Shareholders’ equityEquity
0.4%	0.4%	0.4%	0.3%	0.4%	0.4%	Stock comp / revenueSBC/rev
						Per share
51.9M	56.3M	60.4M	61.4M	61.5M	61.6M	Shares out (diluted)Shares
$26.46	$26.25	$23.56	$24.67	$26.17	$26.63	Revenue / shareRev/sh
$3.60	$3.25	$3.22	$3.65	$2.94	$2.72	EPS (diluted)EPS
$-4.13	$-3.69	$-1.29	$-2.32	$-2.11	$-2.40	Owner earnings / shareOE/sh
$-4.13	$-3.69	$-1.29	$-2.32	$-2.11	$-2.40	Free cash flow / shareFCF/sh
$2.48	$2.49	$2.55	$2.58	$2.62	$2.63	Dividends / shareDiv/sh
$8.37	$9.15	$9.39	$8.95	$8.52	$8.90	Cap. spending / shareCapex/sh
$45.11	$47.35	$46.15	$46.56	$46.89	$47.20	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	4-yr	5-yr
Revenue / share	−0.3%/yr	−0.3%/yr (4-yr)
EPS	−4.9%/yr	−4.9%/yr (4-yr)
Dividends / share	+1.4%/yr	+1.4%/yr (4-yr)
Capital spending / share	+0.4%/yr	+0.4%/yr (4-yr)
Book value / share	+1.0%/yr	+1.0%/yr (4-yr)

The record, charted

FY2021–2025

Each measure over its full record; the current point and the worst year marked.

Share count

62Mpeak FY2025

ROIC

5%low FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

($130M)owner earningsvs.$181Mnet incomelow FY2021

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2021FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported $181M of profit but ($130M) of owner earnings: $311M less than the profit line, taken out by capital spending and the timing of cash.

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$181M	$224M	$194M	$183M	$187M
Depreciation & amortizationnon-cash charge added back	+$250M	+$228M	+$210M	+$195M	+$187M
Stock-based compensationreal costnon-cash, but a real cost	+$7M	+$5M	+$5M	+$5M	+$5M
Working capital & othertiming of cash in and out, other non-cash items	−$43M	−$50M	+$79M	−$76M	−$160M
Cash from operations	$394M	$407M	$489M	$307M	$220M
Capital expenditurecash put back in to keep running and to grow	−$524M	−$549M	−$567M	−$515M	−$434M
Owner earnings	($130M)	($143M)	($78M)	($208M)	($214M)
Owner-earnings marginowner earnings ÷ revenue	-8%	-9%	-5%	-14%	-16%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $7M), owner earnings is nearer ($137M).

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 2.2×

Adequate

Operating income $326M ÷ interest expense $150M

What this means
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
How heavy is the debt, net of cash? $3.3B · 10.1× operating profit

Heavy net debt

Cash $9M − debt $3.3B

What this means
Netting $9M of cash and short-term investments against $3.3B of debt leaves $3.3B owed, about 10.1× a year's operating profit. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? —

Not enough data

What this means
The filing data didn't include the inputs for this check.

Is it a good business?

Return on invested capital 5%

Below average through the cycle

5-yr median, range 5%–12%; 5% latest = NOPAT $315M ÷ invested capital $6.2B

Industry peers: median 6%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 5 years (it ran 5% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin -9%

Consumes cash through the cycle

5-yr median margin, range -16%–-5%; latest ($130M) = operating cash $394M − maintenance capex $524M

Industry peers: median 11%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -8% of revenue this year, a -9% median across 5 years. Treating stock comp as the real expense it is (less $7M of SBC) leaves ($137M).
Are earnings backed by cash? 2.18×

Cash-backed

Cash from ops $394M ÷ net income $181M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? —

No surplus to allocate

What this means
The business didn't generate positive Owner Earnings this year, so any distributions came from the balance sheet or borrowing, not from operations.
Investing or harvesting? 2.10×

Expanding

Capex $524M ÷ depreciation $250M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Near

Revenue ≥ $2B · $1.6B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 0.72×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $3.3B vs ($194M) WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Pass

A profit every year (5-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Pass

Uninterrupted dividends · paid every year (5)

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $3.25/share (latest year $2.94), the averaged base the calculator's gate runs on, and book value is $46.92/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2021–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 5 of 5

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Return on capital ≥ 15% 0 of 4 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 19% → 21% (2-yr avg ends)

What this means
Through the cycle the operating margin held roughly steady — about 19% early, 21% lately, median 20%.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2022 · 17.8% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
Share count +4.4%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.
How management talks about it Owner’s terms

What this means
The filing reasons in an owner’s terms — per-share, return on capital, the long term — and the record has held; the words and the results are of a piece.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Raised, but not as a competitor

The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product.

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$513M

Cash & short-term investments$6M
Receivables$199M
Inventory$134M
Other current assets$174M

Current liabilities$731M

Debt due within a year$105M
Accounts payable$122M
Other current liabilities$504M

Current ratio0.70×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.52×stricter: inventory excluded

Cash ratio0.01×strictest: cash alone against what's due

Working capital($218M)the cushion left after near-term bills

Debt due this year vs. cash$105M due · $6M cash cash alone won't cover the maturities; it leans on refinancing or operating cash · both figures from the Mar 31, 2026 balance sheet

Revenue, latest quarter vs. a year ago+6.6%the freshest read on whether the business is still growing

Current ratio, recent quarters0.5× → 0.7×

Deeper floors

Tangible book value$2.5Bequity stripped of goodwill & intangibles

Net current asset value($5.2B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$3.3Bno operating-lease liability tagged this quarter, so debt alone

From the company's latest filing.

How the cash was used, 2021–2025

Over the record, the business generated $1.8B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$2.6B · 142%
Dividends$743M · 41%

Returned to owners$743M
$743M as dividends and $0 as buybacks.
Source of funding−$1.5B
Reinvestment and shareholder returns ran $1.5B beyond the operating cash the business generated, so the gap was financed off the balance sheet.
Net change in share count18.8%
The diluted count rose from 52M to 62M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record$2.62/sh
Paid in 5 of the years on record, the per-share dividend growing about 1% a year. It was never cut over the span.
Return on what it retained22%
Of the earnings it kept rather than paid out ($227M over the span), annual owner earnings (first three years vs last three) grew $50M, so each retained $1 added about 0.22 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	—	$3.4M	$2.0M	($214M)
2022	Robert Rowe	$3.4M	$2.9M	($208M)
2023	—	$3.1M	$2.4M	($78M)
2024	—	$4.8M	$5.2M	($143M)
2025	Brian Bird	$5.0M	$11.1M	($130M)

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years. A dash under the name means the filing tags the figure without naming the officer.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio41:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$7M
The slice of the business handed to employees in shares this year, 0% of revenue, equal to 2% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why NorthWestern Energy is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2021–2025.

1 of the 4 tests turned up something to look into; the other 3 came back clean.

Look hereDid the share count rise anyway?18.8%
Diluted shares grew 18.8% over 2021–2025. Owners were diluted on net; each share owns less of the business than it did. Read the buyback line beside this one, not on its own.

And these came back clean

Is it less profitable than it was?
Did reported profit become cash?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Pension & retirement, Income taxes as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Multi-Utilities

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
EVRGEvergy	$5.7B	—	24.7%	6%	17%
LNTAlliant Energy	$4.4B	86%	21.7%	6%	1%
AVAAvista	$2.0B	—	16.7%	5%	11%
KNTKKinetik Holdings Inc.	$1.8B	30%	8.1%	3%	22%
NWENorthWestern Energy	$1.6B	—	20.2%	5%	-9%
ALEALLETE	$1.5B	90%	12.6%	4%	11%
AROCArchrock	$1.5B	-25%	17.8%	6%	16%
UTLUNITIL Corporation	$536M	—	16.9%	7%	-7%
Group median	—	—	17.4%	5%	11%

The price

What a price has to assume.

What the price implies

reverse-DCF

NorthWestern Energy is profitable, but owner earnings are negative this year because capital spending currently outruns operating cash, a build-out, so the owner-earnings reverse-DCF has no positive base to grow. We read the price from both ends instead: type a price to see the steady-state profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.

Today’s price $

The assumptions Required return 9% Years to get there 10 Revenue growth 0%

Revenue, delivered4%/yr’21→’25

Mature owner-earnings margin 15%

Enter a price to run it.

Owner earnings it must reach—

Margin the price demands—

Owner-earnings margin today−9%

Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.

Weigh NWE against another business →

The owners of NWE: the meeting and the votes →

Cite: Owner Scorecard, "NorthWestern Energy (NWE), the owner's record," https://ownerscorecard.com/c/NWE, data as of 2026-07-09.

Manual order: ← NWBI its page in the Manual NWFL →

Industry order: ← NI the Multi-Utilities chapter PCG →