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Black Hills Corporation (NYSE: BKH) has a remarkable dividend record, but that alone does not establish that its shares are a buy now. The latest dividend terms established here are $0.703 per quarter, or $2.812 annualized, while the company’s 2025 payout ratio was 68%—above its stated 55%–65% target. A current share price, yield, valuation and merger status are not established, so a price-sensitive buy verdict would be premature.
What Black Hills does
Black Hills Corporation is a regulated electric and natural-gas utility headquartered in Rapid City, South Dakota. Its utilities serve customers in Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. In its January 2026 release, the company reported approximately 1.35 million customers; its investor-relations landing page later showed 1.37 million, so customer counts should be read with their dates.
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For investors, the regulated-utility model makes approved rates, customer and load growth, infrastructure investment, financing costs, weather and regulatory decisions important to earnings. The company’s 2025 Form 10-K provides its formal business and risk disclosures.
How strong is the dividend record?
Black Hills announced its 56th consecutive annual dividend increase in January 2026. The same release said the company and its predecessor had made annual dividend payments for 84 consecutive years, dating to February 1942. These are distinct measures: the payment history is longer than the increase streak. Black Hills’ 2025 Form 10-K described 2025 as its 55th consecutive year of increases; the January 2026 release reflects the following year’s increase.
The January release declared a quarterly dividend of $0.703 per share, up $0.027 from the prior quarter, for an annualized rate of $2.812. It was payable March 1, 2026, to shareholders of record February 17. A July declaration reported in the Q2 filing kept the quarterly rate at $0.703, payable September 1. No later declaration is established here. The annualized figure is the current rate multiplied by four, not the amount paid per share during 2025.
Does earnings cover the dividend comfortably?
Black Hills says it targets a dividend payout ratio of 55%–65% of net income. Its 2025 Form 10-K reported ratios of 64% in 2023, 66% in 2024 and 68% in 2025; the latest full-year figure was three percentage points above the top of its target range.
| Year | Payout ratio | Dividends paid | Dividend per share |
|---|---|---|---|
| 2023 | 64% | $168.1 million | $2.50 |
| 2024 | 66% | $182.3 million | $2.60 |
| 2025 | 68% | $197.9 million | $2.70 |
All figures in the table are reported by Black Hills in its 2025 Form 10-K. The $2.70 paid per share for 2025 should not be confused with the $2.812 annualized rate after the 2026 increase.
For 2025, Black Hills reported diluted GAAP EPS of $3.98 and adjusted EPS of $4.10. Adjusted EPS is a non-GAAP measure, so it is useful as management’s supplemental performance measure but should not be treated as interchangeable with GAAP earnings. The company initiated 2026 adjusted EPS guidance of $4.25–$4.45 and reaffirmed that range in its August 5, 2026 release. The forecast assumes, among other things, normal weather and constructive, timely regulatory outcomes; it is management’s estimate, not a guarantee.
Future dividends remain at the board’s discretion. The company’s filings identify operating results, financial position, cash flows, reinvestment opportunities, capital spending, funds from operations, credit-facility restrictions and business prospects as relevant factors. Statutory requirements, subsidiary-level regulation and bond covenants can also limit distributions.
What could drive growth—and what could go wrong?
Utility investment and large-load demand
Black Hills has cited regulated-system investment, rate reviews, transmission expansion, generation projects and demand from large customers as potential growth drivers. Its February 2026 results release said its data-center request pipeline exceeded 3 GW, with 600 MW included in its five-year plan. In August, the company reported progress toward definitive agreements for a prospective 1.8 GW Wyoming data-center project. These are pipeline, planning and negotiation figures—not evidence that the full load is contracted, built or already generating earnings.
The February release also reported three completed rate reviews representing more than $52 million of new annual revenue during 2025, four new Wyoming Electric peak-load records, a 260-mile transmission expansion and the Lange II 99 MW generation project. These are company-reported milestones and plans; they do not remove the risks of regulatory decisions, construction, customer commitments or financing.
Merger uncertainty
Black Hills and NorthWestern Energy announced an all-stock merger and filed for approvals in several jurisdictions. Black Hills’ August 5, 2026 release said the transaction was on track, with Montana approval remaining as the final closing condition. That is the latest status established here, not confirmation of the deal’s status on October 3, 2026. Until a current company or regulator disclosure confirms otherwise, investors should treat approval and completion as uncertain and consider transaction timing, integration and execution risk.
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Can you determine whether BKH is a buy now?
Not from the dividend record and operating updates alone. To judge whether the shares are attractive at a particular moment, an investor needs a dated share price and yield, valuation comparisons with BKH’s own history and utility peers, and an updated check on the merger. Those figures are not established here, so no current yield, valuation ranking or unconditional buy recommendation is supportable.
For a comparison with other utility stocks, use values from the same date and examine yield and valuation alongside payout and cash-flow coverage, regulated versus competitive exposure, planned capital spending and financing needs, regulatory jurisdictions and rate-case timing, dividend-growth history, and any material merger or large-customer concentration risk. A long streak is relevant context, but the above-target 2025 payout ratio and the company’s reliance on investment, regulation and execution make it only one part of the decision.
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