Fortis Q3 2026 Earnings Preview: The Five-Year Plan Is the Open Question
Fortis Inc. (TSX: FTS) reports third quarter 2026 results on Tuesday, November 3, and the quarter itself is close to pre-agreed. Ten analysts put Q3 earnings at C$0.88 per share against C$0.87 on the same basis a year earlier, a step of 1.4%, from a range that runs only C$0.84 to C$0.94. The part of Tuesday that is genuinely open is the other half of the release. Fortis has said it will publish a new five-year capital outlook covering 2027 to 2031 alongside the results, and that plan sets the rate base, the earnings and the dividend capacity behind everything a Fortis holder owns. The company’s advisory release of October 26 sets the teleconference and webcast for 8:30 a.m. Eastern the same day, with CEO David Hutchens and CFO Jocelyn Perry on the line. On that schedule the results reach the market before the opening bell.
The Street has nearly settled the quarter
The Q3 estimate has come down. It sits at C$0.88 against C$0.90 seven days ago, C$0.91 thirty days ago and C$0.90 ninety days ago, roughly 2.5% below the three-month level and about 3.5% below the thirty-day one. The Q4 estimate fell too, from C$0.95 ninety days ago to C$0.93 now.
The full-year figure barely moved: C$3.61 for 2026 from fourteen analysts, against C$3.61 ninety days ago, with 2027 at C$3.88. The quarterly and annual numbers are not arithmetic complements of each other, because they are not the same panel. Fourteen analysts contribute to the year, ten to Q3 and seven to Q4, and the four quarters sum to about C$3.58 against the stated C$3.61 annual figure. Full-year revenue consensus is C$13.15 billion from seven analysts, in a wide range of C$12.56 billion to C$14.75 billion.
The stock goes into the print close to where analysts already price it. Fortis closed at C$81.97 on Friday, October 30, up 0.84% from C$81.29 the day before, on a session when the S&P/TSX Composite fell 1.74%. The 52-week range is C$69.06 to C$83.75, putting the stock about 2.1% below its high. The mean analyst target is C$81.18 and the median C$82.00, with a high of C$89.00 and a low of C$70.00.
Fortis beats, and it beats small
The eight rated quarters from November 2024 to July 2026. Consensus and actuals: Yahoo Finance.
Fortis beat in seven of those eight quarters and missed once, averaging a surprise of +3.31%. The largest beat was August 2025, C$0.76 against C$0.70 for +8.3%. The only miss was May 2026, C$0.99 against C$1.00, short by 0.8%.
The useful detail is the size rather than the hit rate. Six of the eight surprises fall between -0.8% and +3.5%. Earnings at a regulated utility are largely set by rates regulators have already approved, which leaves limited room for a surprise in either direction. A reader expecting Tuesday to turn on a cent or two of EPS is watching the wrong line.
The stock’s record after these reports, including the part that is easy to misread
Share price change from the pre-report close after each of the last eight reports. Prices: Yahoo Finance.
Measured from the close before each report, the next session averaged +1.18% and was positive six times out of eight. Thirty days out the average was +2.23%, again positive six times. Ninety days out the average was +4.27%, positive in all eight. Across the seven beats, the next session averaged +1.66%.
Two things belong in the same breath as those numbers. The next-day drop of 2.18% after a miss rests on exactly one observation, the May 2026 report, so it is an example and not an average of anything. And the 8-of-8 at ninety days owes a great deal to the direction of the stock over the window rather than to the reports. Fortis went from a pre-report close of C$55.13 in November 2024 to C$81.97 on October 30, roughly 49% higher. The sampled ninety-day gains also shrank as the stock climbed: the two earliest were the largest at 6.2% and 6.0%, the two most recent the smallest at 2.5% and 1.8%. None of this forecasts Tuesday.
What Fortis itself last reported, and why the third quarter is a smaller one
From the company’s own June 30, 2026 quarter report, Q2 2026 net earnings to common shareholders were C$396 million against C$384 million a year earlier, basic and diluted EPS of C$0.78 against C$0.76, and revenue of C$2,931 million against C$2,815 million. Six-month EPS of C$1.76 was unchanged from the same period of 2025, and Fortis quantifies why: the 2025 dispositions “had a $0.01 and $0.03 dilutive impact on second quarter and year-to-date results, respectively, and are expected to have a $0.05 dilutive impact for the annual period” (news release p.1). That is a company-stated drag running through the quarter being previewed.
For the quarter reported Tuesday, Fortis’s own comparatives are revenue of C$2,938 million, common equity earnings of C$409 million and basic and diluted EPS of C$0.81. A C$0.88 quarter against the C$0.99 Fortis printed in Q1 2026 is not deterioration either. In the company’s words, “earnings for the utilities in Canada and New York tend to be highest in the first and fourth quarters due to space-heating requirements”, while “earnings for UNS Energy tend to be highest in the second and third quarters due to the use of air conditioning and other cooling equipment” (p.19).
Two EPS series, two bases, and the trap that arrives Tuesday morning
Fortis publishes no adjusted EPS. Its release and MD&A carry basic and diluted EPS only, and the two are identical in every period it shows. The Street’s series normalises one-time items out, so it sits above Fortis’s reported figure in any quarter carrying a disposition or a regulatory charge. Each gap below is attributable principally to an item Fortis names in its own Summary of Quarterly Results commentary on p.19.
| Quarter | Fortis reported | Street basis | Gap | The item Fortis names |
|---|---|---|---|---|
| Q3 2024 | C$0.85 | C$0.85 | none | none named |
| Q4 2024 | C$0.79 | C$0.83 | C$0.04 | “$20 million at ITC associated with the retroactive impact of a reduction in the MISO base ROE as approved by FERC” |
| Q3 2025 | C$0.81 | C$0.87 | C$0.06 | “income taxes and closing costs totalling $32 million associated with the disposition of FortisTCI in September 2025” |
| Q4 2025 | C$0.83 | C$0.90 | C$0.07 | “a $31 million loss on the disposition of Fortis Belize and Belize Electricity in October 2025” |
Fortis reports weighted-average basic shares of 510.0 million for Q2 2026 and 502.6 million for Q2 2025 (Note 11, p.36), so across that range our own division puts C$20 million at about 4 cents, C$32 million at about 6.3 cents and C$31 million at about 6.1 cents. The first two land on the stated gap. The third runs about a cent light of the 7-cent gap, so the item accounts for most of that quarter’s difference rather than all of it. The same pattern holds annually: Fortis reported FY2025 EPS of C$3.40 while the Street’s year-ago full-year figure is C$3.53, and the two 2025 disposition items together account for the thirteen-cent difference.
Neither series is wrong. They are different bases, and the practical consequence lands on Tuesday in a specific way. If Fortis prints a reported figure near the C$0.88 consensus, its own year-over-year comparison runs against the C$0.81 it reported for Q3 2025, an increase of roughly 9%, because that base quarter carries the C$32 million FortisTCI charge. The same release will read as a small beat against the Street’s C$0.87 and as a large step up in the company’s own table. Both describe the identical quarter.
The capital plan is the half that is still open
The plan as it stands is C$28.8 billion for 2026 to 2030, lifting midyear rate base from C$42.4 billion in 2025 to C$57.9 billion by 2030. That 2025 starting figure is the one the Q2 2026 MD&A now carries, and it is a touch above the C$41.9 billion the November 2025 release quoted for the same year. Rate base is the regulated asset value a utility is allowed to earn a return on, and Fortis’s own framing is that long-term rate base growth drives the earnings that support its dividend guidance.
The composition is fully disclosed on p.16: 46% transmission, 31% distribution, 7% generation, 5% renewable gas and LNG, and 11% other, largely information technology and facilities. Only 21% relates to Major Capital Projects, which Fortis describes as making the plan “low risk and highly executable”. Geographically 63% of planned expenditures are in the U.S., including 34% at ITC, with 35% in Canada and 2% in the Cayman Islands. Fortis spent C$2.7 billion in the first half of 2026 against a C$5.6 billion plan for the full year, which it calls “consistent with expectations and representing 48% of the Corporation’s annual $5.6 billion Capital Plan”. The C$0.1 billion decline from the first half of 2025 was “due to the timing of expenditures, as well as the lower U.S. dollar-to-Canadian dollar exchange rate” (p.7).
The DRIP funds the common equity
This is the part a bigger plan does not answer by itself. From p.16, verbatim: “The Capital Plan is expected to be funded primarily by cash from operations and regulated utility debt. Common equity is expected to be provided by the Corporation’s DRIP, assuming current participation levels.” The C$500 million at-the-market equity program “has not been utilized to date”.
Funding common equity through the dividend reinvestment plan has a visible cost, and Fortis’s own annual figures show it. Over FY2021 to FY2025, common equity earnings grew from C$1,231 million to C$1,714 million and reported diluted EPS from C$2.61 to C$3.40. By our arithmetic on those published series, earnings compounded at about 8.6% a year while per-share earnings compounded at about 6.8%, and dividends per share at about 4.8%. The 1.8-point wedge between the earnings line and the per-share line is share count, growing roughly 1.7% a year, which Fortis attributes to an increase in weighted-average shares “largely associated with the Corporation’s DRIP”.
Reported diluted EPS, FY2021 to FY2025, labelled at +6.8% a year. Source: Fortis Inc. annual reports, Selected Annual Financial Information, FY2025 report p.38 and FY2023 report p.43.
Dividends declared per common share, FY2021 to FY2025, labelled at +4.8% a year. Source: Fortis Inc. annual reports, Selected Annual Financial Information, FY2025 report p.38 and FY2023 report p.43.
Set side by side, those two charts are the shape of the trade: growth funded in part by issuing shares to existing holders, with the dividend covered and the payout ratio falling. On our arithmetic from the same two series, declared dividends were about 74% of reported diluted EPS in FY2025, C$2.51 against C$3.40, down from about 80% in FY2021, C$2.08 against C$2.61. Readers who weigh utilities on that relationship can compare it against our Canadian high-yield dividend stocks ranked by payout coverage.
Reading Tuesday’s plan number without being fooled by it
A headline increase in plan size is not automatically new investment. The current plan “reflects an assumed U.S. dollar-to-Canadian dollar exchange rate of 1.35”, and Fortis states that “a five-cent increase or decrease in the U.S. dollar relative to the Canadian dollar would increase or decrease the Capital Plan by approximately $0.7 billion over the five-year planning period” (p.16). The rate at June 30, 2026 was 1.42 (p.4), seven cents above that assumption, which on the company’s own sensitivity is close to a billion dollars of plan size by our arithmetic. With 63% of expenditures in the U.S., a new plan struck at a higher assumed rate would carry part of any headline increase as currency rather than new capital.
The growth rate is the cleaner of Tuesday’s two headline numbers, and for a stated reason. Fortis calculates it on a constant currency basis: its own footnote reads “growth rate calculated using a constant U.S. dollar-to-Canadian dollar exchange rate” (p.2), and the glossary repeats it (p.21). So the percentage cannot be flattered by the currency effect that can move the dollar figure, and a rate worked out from the published endpoints will not reproduce the company’s own, because the two are struck on different exchange rate bases. The company’s figure is the one to use.
The two-year precedent
Fortis has used the Q3 release to roll the plan forward in each of the last two years, and declared the annual dividend increase at the same time.
| Q3 release | New plan | Years | Midyear rate base | Growth rate, company’s words | Dividend |
|---|---|---|---|---|---|
| November 2024 | C$26 billion | 2025-2029 | C$38.8bn (2024) to C$53.0bn (2029) | “five-year compound annual growth rate of 6.5%” | “Declared 4.2% increase in fourth quarter common share dividend” |
| November 4, 2025 | C$28.8 billion, “$2.8 billion higher than prior plan” | 2026-2030 | C$41.9bn (2025) to C$57.9bn (2030) | “annual growth rate of 7.0%” | “Increased fourth quarter common share dividend by 4.1%”, plus guidance extended to 4-6% through 2030 |
| November 3, 2026 | to be announced | 2027-2031 |
Across those two Q3 releases the plan grew from C$26 billion to C$28.8 billion, about 11%, and the growth rate Fortis attached to it stepped from 6.5% to 7.0%. Whether the 2027-2031 outlook continues that is Tuesday’s actual question.
On the dividend, the record is 52 consecutive years of increases and the guidance is 4% to 6% annual growth through 2030. Fortis paid C$0.64 per common share in Q2 2026, up 4.1% from C$0.615. Both of the last two increases, 4.2% and 4.1%, sat at the lower end of the guidance band. Applying that band to the current C$0.64 rate spans roughly C$0.666 to C$0.678, which is arithmetic on the company’s own guidance and nothing more. That record is where Fortis sits first in our ranking of Canadian dividend stocks, and what a 4% to 6% band compounds to on a position of a given size is a calculation our dividend income calculator will run.
Two regulatory decisions sit behind the plan
Both are disclosed on p.12, and one has a date. TEP filed a general rate application with the Arizona Corporation Commission in June 2025, requesting new rates effective September 1, 2026, a proposal to phase out or eliminate certain adjustor mechanisms, an annual formulaic rate adjustment mechanism, and the deferral of certain Roadrunner Reserve II costs for future recovery. “In June 2026, the Administrative Law Judge issued an extension of the procedural schedule such that a final decision on the rate case will be issued by November 17, 2026”, two weeks after Tuesday’s print.
The most recent thing the same regulator granted a Fortis subsidiary is the yardstick for what TEP might get. On UNS Gas, “in February 2026, the ACC issued an order approving an allowed ROE of 9.61% and a 56% common equity component of capital structure”, together with a formulaic rate adjustment mechanism carrying a range of plus or minus 50 basis points around the allowed ROE. Those rates took effect March 1, 2026. The formula framework itself is contested: the Residential Utility Consumer Office has challenged the ACC’s authority to implement one through a policy statement, and in November 2025 the Arizona Court of Appeals ruled it may proceed with that challenge. Fortis says the timing and outcome of these proceedings are unknown.
The second decision is open-ended and larger. A 2021 FERC supplemental notice of proposed rulemaking “proposes to eliminate the 50-basis point RTO ROE incentive adder for RTO members that have been members for longer than three years”. Fortis says that “although the timing and outcome of this proceeding are unknown, every 10-basis point change in ROE at ITC impacts Fortis’ annual EPS by approximately $0.01”. Multiplying the company’s sensitivity across the full 50 basis points puts roughly five cents of annual EPS at stake, by our arithmetic. Two things make that more than a footnote: ITC accounts for 34% of planned capital expenditures, and a FERC ROE reduction at ITC has already moved the reported line once, in the C$20 million MISO base ROE charge in Q4 2024.
What Tuesday means for a holder
The EPS line is the least informative part of this release. Consensus asks for 1.4% growth on a Street basis, the company’s own comparative is C$0.81 on a different basis, a stated C$0.05 annual disposition drag is running through the year, and the record says surprises here are measured in single cents.
The capital outlook is where the next five years of rate base, and therefore the earnings Fortis says support its dividend growth, get set. The questions it answers on Tuesday are whether the plan extends the step from C$26 billion to C$28.8 billion, whether the growth rate attached to it holds at or above 7.0%, how much of any increase in plan size is the currency assumption rather than new capital, and whether common equity still comes from the DRIP at current participation. That is the part nobody has yet, and it is the part worth reading first.
Prices, analyst targets and the 52-week range are from Yahoo Finance as of the October 30, 2026 close. Consensus estimates are from Yahoo Finance, pulled November 1, 2026. Company figures are from Fortis Inc.’s own filings as cited above.
Disclaimer: The content on bestcanadianstocks.ca is for informational and entertainment purposes only and does not constitute financial advice. Past performance is not indicative of future results. Always consult a qualified financial advisor before making investment decisions. Every Fortis company figure in this piece comes from Fortis’s own documents: the June 30, 2026 Quarter Report (combined press release, interim MD&A and financial statements), the Q3 2025 and Q3 2024 results releases, the October 26, 2026 advisory on the November 3 release, and the FY2025 and FY2023 annual reports’ Selected Annual Financial Information. Reported EPS, revenue, common equity earnings, the capital plan, rate base, the dividend record and the ITC ROE sensitivity are all the company’s own, each carrying a document and page citation. Analyst consensus, analyst price targets, share prices and the 52-week range are Yahoo Finance, labelled as such. The S&P/TSX Composite session change is our reading of index data from Yahoo Finance for the October 30, 2026 session. The eight-quarter EPS surprise and post-report price reaction series are Yahoo-derived and are credited on both charts. Fortis publishes no adjusted EPS measure: its filings carry basic and diluted EPS only, and the two are identical in every period shown. The per-share conversions of the disposition items, the implied 4 to 6 percent dividend band on the current C$0.64 rate, the 8.6 percent cross-basis figure and the 49 percent run in the stock across the reaction window are our arithmetic on the company’s own rounded published figures and are labelled as ours. No rate base growth rate is computed here: Fortis’s own 6.5% and 7.0% are quoted and attached to the releases that stated them.
