MDU Resources’ first quarter results fell short of Wall Street’s revenue and earnings expectations, driven primarily by significantly milder winter weather across its utility service territories. Management highlighted that lower retail sales volumes, especially in its electric and natural gas utilities, resulted in decreased earnings compared to last year. CEO Nicole Kivisto directly attributed the softer quarter to weather, noting that “mild winter weather impacts reduced earnings by approximately $0.03 per share.” Operational improvements, such as the Badger Wind Farm coming online and rate relief in select regions, partially offset these weather-related declines.
Is now the time to buy MDU? Find out in our full research report (it’s free for active Edge members).
MDU Resources (MDU) Q1 CY2026 Highlights:
- Revenue: $606 million vs analyst estimates of $688.3 million (10.2% year-on-year decline, 12% miss)
- EPS (GAAP): $0.39 vs analyst expectations of $0.43 (9.5% miss)
- Adjusted EBITDA: $170.9 million vs analyst estimates of $177 million (28.2% margin, 3.5% miss)
- EPS (GAAP) guidance for the full year is $0.97 at the midpoint, missing analyst estimates by 2.5%
- Operating Margin: 18.9%, up from 16.7% in the same quarter last year
- Market Capitalization: $4.73 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 Q1 Earnings Call
- Julien Dumoulin-Smith (Jefferies) asked about the timeline for finalizing the remaining 60% of Bakken East pipeline precedent agreements. CEO Nicole Kivisto expressed optimism, stating negotiations are active and the third-quarter target for a final investment decision remains on track.
- Julien Dumoulin-Smith (Jefferies) inquired about the potential for additional laterals and capital intensity in serving large-load customers. Kivisto said the company may shift toward more capital-intensive investment if warranted by customer commitments.
- Julien Dumoulin-Smith (Jefferies) questioned financing options for the Bakken East pipeline. CFO Jason Vollmer explained all options are being evaluated, including partnerships and maintaining a majority stake, to optimize shareholder returns.
- Ryan Michael Levine (Citi) asked for updates on the Montana rate case and prospects for settlement. Vollmer noted interim rates are in effect, with a hearing scheduled for later in the summer, and management remains open to settlement discussions.
- Aiden Kelly (JPMorgan) focused on the interplay between pipeline development and data center opportunities, particularly regarding future power generation. Kivisto indicated that demand pull from power generation is already included and further opportunities could arise post-investment decision.
Catalysts in Upcoming Quarters
In upcoming quarters, our analysts will watch (1) the pace of securing final Bakken East pipeline agreements and any decisions on project financing or partnerships; (2) continued growth and monetization of data center loads, including new service agreements and the ramp-up of online capacity; and (3) progress and outcomes in pending rate cases, especially in Montana and Oregon. These milestones will provide important signals on whether MDU Resources is delivering against its operational and strategic priorities.
MDU Resources currently trades at $22.62, up from $22.31 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).
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