National Grid plc stock is heading into the end of 2025 with investors focused on a single, very modern problem: electrification is accelerating faster than grid infrastructure can comfortably keep up. For a regulated utility, that can be a gift (predictable, funded growth) or a headache (political scrutiny, bill impacts, execution risk). Right now, the market is weighing both.
As of the latest available close (19 December 2025), National Grid shares (LSE: NG.) were trading around 1,142p, giving the group a market capitalisation of roughly £56.6 billion and a trailing dividend yield around 4.1% (based on broker-screen pricing). [1]
What’s driving the debate into 2026 is a combination of (1) a major UK regulatory settlement for the next price-control period, (2) new “Great Grid Upgrade” contract wins and supply-chain milestones, and (3) continued momentum in the US regulated business, where rate plans underpin capital investment and allowed returns.
National Grid share price snapshot: where the stock sits today
With the UK market closed on 20 December, the freshest official snapshot is the 19 December close:
- Price: ~1,142p (with quoted buy/sell around 1,140p–1,140.5p at the time of the close data)
- 52-week range: roughly 909.8p to 1,183.5p
- One-year performance: about +23.9% (based on the data provider’s methodology)
- Dividend yield: about 4.09%
[2]
Those numbers matter because National Grid’s investor base tends to be a blend of income-focused holders (who care about dividend durability and inflation linkage) and long-horizon investors (who care about the size, visibility, and financeability of the capital programme).
The big UK catalyst: Ofgem’s RIIO‑3 / RIIO‑T3 final determination
What was published, and why investors care
On 4 December 2025, National Grid published a market announcement responding to Ofgem’s Final Determination for the RIIO‑T3 framework (covering National Grid Electricity Transmission for April 2026 to March 2031). The headline number investors immediately latched onto was the proposed real allowed cost of equity of 6.12% at 60% gearing. [3]
National Grid’s statement also signalled that the Final Determination is not the end of the story. The company said it would review the full package and highlighted that licence modifications (and the detailed incentive framework) are still critical to deciding whether the regime is “investable and workable.” It expects Ofgem to publish the proposed licence modifications, with a decision on the licence anticipated in February, and National Grid said it anticipates announcing its response in early March 2026. [4]
For equity investors, that creates a clear, date-driven runway: the market now has a window in which regulatory detail could either reduce uncertainty (supportive for the stock) or reintroduce it (pressure on valuation).
The broader RIIO‑3 settlement: bills up, but investment (and savings) are the point
Ofgem’s RIIO‑3 Final Determinations are designed to fund what is effectively a national infrastructure upgrade cycle. In its overview document, Ofgem said it is approving £28.1bn of upfront investment across electricity transmission, gas transmission, and gas distribution price controls, within a wider ~£90bn investment pipeline over the RIIO‑3 period (1 April 2026 to 31 March 2031). [5]
Ofgem also acknowledged the political reality: network charges could rise. The overview notes that for households with median energy use, network charges for these sectors could rise by around £108 by 2031 (if all prospective electricity transmission investment is needed), but Ofgem also estimates ~£80 of savings by 2031 compared with “doing nothing,” largely by enabling more renewable penetration and reducing constraint costs (payments when the grid cannot transmit available generation). [6]
Reuters reported the same broad direction of travel: Ofgem approved a £28bn grid investment package, with network charges expected to raise average bills by around £108 by 2031, while Ofgem expects savings that partly offset the impact. [7]
For National Grid stock, the translation is straightforward but crucial: RIIO‑T3 is one of the main mechanisms that determines how much capital can be deployed, how quickly it can be recovered, and what returns are achievable in the UK transmission business.
“Great Grid Upgrade” momentum: Sea Link contracts and supply-chain anchoring
Sea Link: two major contracts, and a jobs-and-manufacturing narrative
On 11 December 2025, National Grid announced it had signed two contracts for Sea Link, a proposed 140km subsea electricity connection between Kent and Suffolk. Under the contracts, Siemens Energy is set to build converter stations and Sumitomo Electric Industries will supply the high-voltage cable. [8]
This wasn’t communicated as a quiet procurement update. National Grid framed it as part of a wider industrial strategy around delivery capacity and UK supply chains:
- The Great Grid Upgrade is described as looking to support up to 55,000 jobs nationally across design, construction, engineering, manufacturing and supply chain roles. [9]
- National Grid said Sumitomo’s involvement marks a return of HVDC cable manufacturing to the UK for the first time in more than 20 years, citing a £350m investment at the Port of Nigg in Scotland creating around 150 skilled jobs. [10]
From a stock perspective, the “jobs” angle isn’t fluff. It is part of the political licence to operate for large grid buildouts—especially when consumer bills and local planning concerns are in the spotlight.
Contracts aren’t the same as consent
National Grid explicitly noted that the contract award is a positive step for Sea Link, but does not influence the ongoing development consent application, which is under review by the Planning Inspectorate. [11]
Investors typically treat this as a classic UK infrastructure risk split:
- Delivery risk (can you build it on time and on budget?)
- Consent risk (can you get permission in the first place, and under what conditions?)
Sea Link progress supports the delivery side, while consent timelines remain a separate swing factor.
Financial performance: a regulated business stepping up investment
National Grid’s most recent half-year results statement (six months ended 30 September 2025) shows the company continuing to lean into a high-investment phase.
Record first-half capital investment, and a full-year runway
National Grid reported total capital investment of £5,052m, up 12% at constant currency versus the prior period, describing it as “another record level” for a first half. [12]
Management also stated it was on track to deliver over £11bn of capital investment for the full year, in line with guidance and its five-year framework. [13]
That capital is not evenly distributed: the same document breaks out large contributions from UK Electricity Transmission, New York, and New England. [14]
Earnings and operating profit trends
For the half year, National Grid reported:
- Underlying EPS of 29.8p, up 6% year-on-year (with commentary noting factors such as the increased weighted average share count after a rights issue and higher net interest costs). [15]
- Total underlying operating profit of £2,292m, with segment contributions including UK Electricity Transmission, New England, and New York. [16]
Reuters, reporting on the same period, noted the first-half profit outcome and reiterated that National Grid has guided to underlying EPS growth in the medium term. [17]
Balance sheet context: net debt and divestment proceeds
The half-year statement also reported net debt of £41.8bn as of 30 September 2025, around £0.5bn higher than at 31 March 2025, with the company pointing to capital investment as a driver, partially offset by £1.5bn of net proceeds from the divestment of National Grid Renewables and FX movements. [18]
For equity valuation, this matters because the “grid capex supercycle” is typically debt-intensive—even when it’s regulated and recoverable—so funding costs and credit ratings can become just as important as allowed returns.
US regulated business: rate plans underpin the growth engine
National Grid’s US operations are a major piece of the investment thesis, and the most recent disclosures reinforce how central regulation is on both sides of the Atlantic.
New York: a three-year rate plan and allowed RoE
National Grid said it received unanimous approval from the New York Public Service Commission for its joint proposal for Niagara Mohawk Power Corporation (NIMO), and that the settlement includes funding for $5.6bn of capital investment over three years and a 9.5% allowed return on equity. [19]
Separately, National Grid’s US website also summarised the PSC’s approval of a three-year electric and gas delivery rate plan for upstate New York, framed around balancing affordability with reliability and resiliency investments. [20]
Massachusetts: cost recovery visibility, and a coming gas filing
In Massachusetts, National Grid said it received approval from the Department of Public Utilities for around $600m of cost recovery under the Electric Sector Modernization Plan (ESMP), supporting network and technology investment over five years from July 2025. [21]
The same half-year statement also said the company is preparing to file for new rates for its Massachusetts Gas business in January 2026. [22]
For National Grid stockholders, this is the US-side equivalent of RIIO: rate case outcomes and trackers shape capital recovery, cash flow timing, and the “quality” of growth.
Dividend: what income investors are watching next
On the income side, National Grid’s UK listing remains closely followed for dividend reliability.
The company’s investor event calendar lists:
- Interim dividend paid:13 January 2026 (for qualifying shareholders) [23]
Broker-screen data also shows the interim dividend amount and the ex-dividend schedule that aligns with those dates. [24]
With the stock’s indicated yield around 4%, income investors will likely stay tuned to (1) funding costs, (2) the pace of capex, and (3) the final “workability” of the UK incentive framework—because those variables influence how comfortably dividends can grow alongside balance-sheet demands.
Analyst forecasts and price targets: cautious upside, “Buy”-leaning consensus
Analyst views around National Grid tend to cluster around the same debate: how much of the capex boom is already in the price, and whether regulation remains supportive enough to fund the buildout without eroding equity value.
Consensus view
Investing.com’s consensus snapshot (polling the past three months) shows an overall “Buy” consensus, with 10 Buy, 4 Hold, and 1 Sell ratings. The average 12‑month price target is 1,195.8p, with a stated upside of roughly +4.76%, and a target range from 1,070p to 1,300p. [25]
Selected broker notes reported in the market
Publicly distributed summaries of broker research around mid-December include:
- Bernstein reiterated a Buy and kept a target price of 1,300p, according to a MarketScreener report citing a Bernstein note. [26]
- TipRanks/TheFly reported Morgan Stanley initiated coverage of National Grid’s ADR with an Overweight rating and an $85.50 price target. [27]
These aren’t guarantees of performance, but they highlight how the Street is framing the opportunity: a regulated utility that may be a relatively direct way to express the “grid buildout” theme—without taking commodity price risk.
What could move National Grid stock in early 2026
National Grid shares often trade more on regulatory clarity and funding confidence than on dramatic quarterly surprises. With that in mind, the next catalysts are fairly legible.
1) RIIO‑T3 licence modifications and National Grid’s March response window
National Grid has explicitly pointed investors to a timeline: licence modifications, a regulator decision in February, and a company response anticipated in early March 2026. [28]
That sequence could reduce uncertainty (supportive for valuation) or expose disagreements about incentives and cost recovery (less supportive).
2) Planning and delivery progress across major UK projects
Sea Link procurement progress is tangible, but consent and community impact remain live issues. [29]
Execution—securing suppliers, labour, and equipment at scale—will also remain in focus across the Great Grid Upgrade portfolio.
3) US rate-case cadence and cost-of-capital conditions
With New York’s upstate plan approved and Massachusetts cost recovery visibility improving, the market will watch for the next filings and outcomes—particularly where affordability politics are intensifying. [30]
4) Interest rates, FX and financing
National Grid’s high-investment phase naturally increases sensitivity to funding conditions. Even in regulated models, the timing of recoveries matters, and debt costs can affect equity narratives—especially with net debt disclosed at £41.8bn in the latest half-year statement. [31]
Bottom line: a “grid buildout” stock with real catalysts—and real scrutiny
As of 20 December 2025, National Grid plc stock sits at the intersection of three powerful forces:
- A regulatory framework (RIIO‑T3 / RIIO‑3) designed to unlock massive infrastructure investment, while attempting to cap excess returns and manage bill impacts. [32]
- A project pipeline that is moving from strategy into procurement and delivery, highlighted by the Sea Link contract awards and supply-chain commitments. [33]
- A US regulated engine where approved rate plans and trackers can support multi-year capital deployment and earnings visibility. [34]
Analysts, in aggregate, see modest upside from here based on published target prices, but the next leg for the shares may depend less on near-term sentiment and more on whether the RIIO‑T3 fine print convinces markets that National Grid can deliver “at pace” while keeping returns globally competitive and the balance sheet resilient. [35]
References
1. www.hl.co.uk, 2. www.hl.co.uk, 3. data.fca.org.uk, 4. data.fca.org.uk, 5. www.ofgem.gov.uk, 6. www.ofgem.gov.uk, 7. www.reuters.com, 8. www.nationalgrid.com, 9. www.nationalgrid.com, 10. www.nationalgrid.com, 11. www.nationalgrid.com, 12. www.nationalgrid.com, 13. www.nationalgrid.com, 14. www.nationalgrid.com, 15. www.nationalgrid.com, 16. www.nationalgrid.com, 17. www.reuters.com, 18. www.nationalgrid.com, 19. www.nationalgrid.com, 20. www.nationalgridus.com, 21. www.nationalgrid.com, 22. www.nationalgrid.com, 23. www.nationalgrid.com, 24. www.hl.co.uk, 25. www.investing.com, 26. www.marketscreener.com, 27. www.tipranks.com, 28. data.fca.org.uk, 29. www.nationalgrid.com, 30. www.nationalgridus.com, 31. www.nationalgrid.com, 32. data.fca.org.uk, 33. www.nationalgrid.com, 34. www.nationalgridus.com, 35. www.investing.com
