Options traders are pricing in more downside protection for NI. The put-call ratio jumped to 1.09 on July 16 — 45% above its 20-day mean of 0.75. The z-score of 3.6 places this move in rare territory. It is the highest PCR reading since June and approaches the 52-week high of 1.15.
The PCR shift didn't arrive quietly. For weeks, the ratio held in a tight band around 0.70–0.71. Then it broke sharply higher in a single session. That kind of step-change in options demand — rather than a gradual drift — suggests deliberate hedging rather than routine portfolio rebalancing.
Short positions have also been building. SI climbed roughly 20% over the past week to 2.74% of float. At that level, short interest is modest in absolute terms. But the pace of accumulation is notable. Shares short jumped from around 10.9 million in early July to over 13 million — a move of roughly 2.2 million shares in under two weeks.
NiSource reports earnings on 5 August. That date is close enough to attract options positioning now. Recent earnings prints have been mixed: the May report produced a 1% single-day gain, but the prior release saw a 2.4% drop followed by continued weakness.
Analysts remain broadly constructive. RBC Capital initiated coverage on 2 July with an Outperform rating and a $52 target. Wells Fargo and Barclays both carry Overweight ratings. The consensus target sits at $51.17, roughly 10.6% above the current close of $46.27. The bull case centres on the Amazon data center contract and a favourable regulatory environment across NiSource's multi-state footprint.
The bear case is more specific: execution risk on the Amazon project, potential anti-data center legislation in Indiana, and heavy concentration in the Midwest natural gas distribution business.
One thing the options spike is not signalling is a short squeeze setup. Availability in the lending market sits at 9,735%. That means roughly 97 shares are available to borrow for every one currently lent out. The borrow market is wide open. Cost to borrow is 0.47% — low, and actually down 16% over the past week after a brief mid-July spike. There is no friction for new short sellers.
T. Rowe Price added nearly 29.9 million shares in the most recent reporting period, taking a 10.6% stake. That is a substantial institutional accumulation. Insider activity over the past 90 days has been net selling — CEO Lloyd Yates sold roughly $950,000 in late May — though most trades carry low significance scores.
The convergence here is unusual for a utility. A z-score above 3.5 on the PCR, combined with a 20% week-on-week rise in short interest, ahead of an August 5 earnings date, makes NI worth monitoring into results.
Data summary
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