On the desk · Utilities
Fortis (FTS): Fifty-two years of raises, read honestly.
The read · Machine
North American regulated utility with ten operating subsidiaries spanning Canada, the US, and the Caribbean. ITC (US transmission), UNS (Arizona), FortisBC, FortisAlberta, Central Hudson (New York). The longest dividend-growth record in Canada (over fifty consecutive annual raises).
Generated May 14, 2026 from Fortis FY 2025 disclosure and Q4 2025 release (February 2026). Reviewed by principal May 14, 2026.
By the numbers
- FY 2025
- Regulated rate base
- ~C$45B (FY 2025 mid, approx.)
- 5-year capital plan
- ~C$26B (2024–28)
- Rate-base growth target
- ~6% CAGR
- Dividend growth target
- 4–6% per year
- Consecutive raises
- 52 years (longest in Canada)
- Regulated share of earnings
- ~99% regulated
- Listings
- TSX: FTS · NYSE: FTS
What we track
- ITC capital deployment and authorized ROE
- Rate cases at UNS, FortisBC, and Central Hudson
- Capital plan execution against the rate-base growth target
- Net debt rating actions
- Per-share dividend growth pace within the 4–6% band
The Trough Test
The note · Principal
The note
Fortis is the least exciting name on the desk and one of the more important to read carefully. Fifty-two consecutive years of dividend increases is not a marketing line; it is the receipt for a capital culture that has compounded a regulated rate base through every cycle since the early 1970s. We read Fortis as the reference compound on the infrastructure side of the universe.
The business, in one paragraph
Fortis owns ten regulated utility subsidiaries. ITC is the US transmission business based in Michigan and is the largest single contributor. UNS Energy serves Arizona. FortisBC and FortisAlberta serve Western Canada. Central Hudson serves New York's Hudson Valley. Smaller subsidiaries operate in Newfoundland and Labrador, Prince Edward Island, Ontario, the Cayman Islands, and Belize. Roughly 99% of earnings are regulated.
What FY 2025 actually said
The regulated rate base grew at the targeted rate. The five-year capital plan was reiterated at approximately C$26B for 2024–28. The dividend was raised within the 4–6% target growth band for the fifty-second consecutive year. Net debt remained at the conservatively-levered end of the utility cohort. Rate cases at the operating subsidiaries proceeded broadly as expected; ITC continued to deploy capital against the high-voltage transmission build the US grid requires.
Two things we are reading carefully
1. ITC and the US transmission build
ITC was the 2016 acquisition that materially re-shaped Fortis. The US high-voltage transmission system has years of underinvestment to repair, and ITC is positioned in the right geographies to deploy the next decade of that capital. We track the ITC capital plan, the authorized ROE band, and the regulatory cadence in each of its FERC-regulated jurisdictions.
2. The per-share dividend growth pace
The 4–6% band is generous. The pace within that band is the part the principal sets each year, and is informative. We watch the per-share growth pace as a leading indicator of how comfortable management is with the capital plan execution. A 6% raise is a confident year. A 4% raise is a careful one.
What we are watching into FY 2026
- ITC capital deployment and authorized-ROE band.
- Rate cases at UNS, FortisBC, and Central Hudson.
- Capital plan execution against the 6% rate-base CAGR.
- Per-share dividend pace within the 4–6% target band.
A regulated utility is the boring half of the desk. The boring half is the part that pays for the wait.
Checklist scorecard
Ten questions, three pillars. Status icons reflect the principal's read on this name; absent a green dot, fall back to the question's standard note. See the full Checklist for the framework.
Pillar I
The business
Does it generate free cash flow through the full cycle, or only the top half of it?
Pass
FCF through every cycle since the early 1970s. The regulated-rate-base model is the structural reason.
Do the unit economics still work at the worst price of the last decade?
Pass
Unit economics are regulated. Trough commodity prices barely move the earnings.
What does the balance sheet look like at trough pricing: net debt, covenants, maturity ladder?
Pass
Investment-grade; well-laddered debt; conservatively financed for a utility.
When they reinvest a dollar (capex, M&A, or buyback), what actually comes back?
Pass
Reinvestment record is the cleanest on the desk. The ITC and Central Hudson acquisitions earned their cost of capital.
Pillar II
The people
How much of the operator's own net worth, bought and not granted, sits in this name?
Not yet
Insider ownership is modest. Capital allocation behaviour at the board is the more important read.
What did management actually do in 2015 and 2020: issue, buy back, or sit still?
Pass
2015 and 2020: dividend raised in both years. Fifty-two consecutive years of raises is the record.
Is compensation tied to per-share value, or to production, revenue, and size?
Pass
Compensation is per-share-aligned. The board is discipline-oriented.
Who succeeds the operator, and is that person already visible on the page?
Pass
Succession is visible; Hutchens came from UNS into the parent seat.
Pillar III
The cycle
Where are we on the cost curve that matters: the real one, not the one in the pitch deck?
Pass
Regulated rate base is the cleanest structural advantage on the desk. The cost-curve discussion does not apply.
What does a “normal” year look like a decade from now, and does this business still work at that price?
Pass
Underwriting at any realistic North American electricity-demand path, the regulated rate base earns. The decade-out picture is favourable, particularly with electrification.
Disclosure
This writeup is for informational and educational purposes only and is not a recommendation, solicitation, or price call. The author may hold a position in Fortis Inc. and may transact at any time without notice. Figures are sourced from Fortis's FY 2025 disclosure and Q4 2025 release (February 2026). Where a figure is marked “(approx.)” or “—” the source disclosure was either unconfirmed or unreported at the time of writing. See the Terms of Use for the full disclaimer. Halvren's companion writeup may appear on Substack at greater length.
Pillar I. The business. Fortis is 99% regulated. The rate base sits on ten operating subsidiaries that collectively span Canada, the US, and the Caribbean. ITC is the US transmission asset that came over in 2016 and has performed at or above the original case. The reinvestment record is the cleanest on the desk; every meaningful acquisition has earned its cost of capital. The capital plan is sized for a 6% rate-base CAGR.
Pillar II. The people. David Hutchens came from UNS into the parent CEO seat in 2021 and the capital culture is continuous with the long Marshall and Perry tenures before him. The dividend has been raised in every year of every cycle since 1972. The 2015 and 2020 records are unremarkable in the best sense of the word; nothing changed.
Pillar III. The cycle. Electric utility rate base is a long-cycle, regulated asset. The decade-out picture is favourable: electrification, data center demand, grid replacement, transmission build. Underwriting at the 4–6% dividend growth band, Fortis is a compounder. Not a dramatic one. The kind whose total return record over forty years is hard to argue with.