LONDON, March 24, 2026, 19:51 GMT
National Grid shares closed up 1.73% at 1,232 pence on Tuesday, brushing off a Goldman Sachs downgrade to neutral as investors kept backing the utility’s spending-led growth story. The stock beat the FTSE 100, which ended the day up 0.7%. 1
The resilience matters because National Grid is trying to hold onto a strong run just as UK rate expectations climb again and brokers grow less willing to chase the stock. Even after Tuesday’s rise, the shares were still about 14% below their March 2 peak, reached after the company lifted its medium-term earnings outlook. 1
Goldman cut the stock to neutral from buy and lowered its target price to 1,389 pence from 1,450, saying the rally and easing funding worries had narrowed the upside. The bank also cut SSE to neutral while raising targets on United Utilities and Severn Trent, a sign it is getting more selective across UK regulated utilities. 2
Investors are still leaning on National Grid’s own numbers. The company said on March 2 it would invest at least £70 billion by March 2031, target about 10% annual asset growth and forecast 13%-15% growth in adjusted earnings per share, or EPS, in fiscal 2027 as it moves into RIIO-T3, Ofgem’s next five-year price-control period for electricity transmission. Chief executive Zoë Yujnovich called it “a further step in accelerating investment in Britain and the US Northeast.” 3
Goldman’s earlier buy case had rested on that same theme: more investment, faster earnings growth and a valuation that looked oversold after National Grid’s 2024 equity raise. The bank now says much of that re-rating has already landed, after the shares rose 45% since its June 2024 upgrade. 4
The broader tape helped. London’s blue-chip index rose as investors weighed mixed signals from the Middle East, and AJ Bell’s Dan Coatsworth said Britain’s exposure to energy shares “gave the FTSE 100 fuel to pull ahead of the market pack.” 5
But the risk sits elsewhere. A Citi/YouGov survey showed British households’ short-term inflation expectations jumped to 5.4% in March from 3.3% in February, and Reuters reported traders are pricing in almost three quarter-point Bank of England hikes this year. For utilities, higher bond yields can make steady dividends and regulated returns look less special. Citi economist Callum McLaren-Stewart said “it’s difficult to avoid the reality that this is a significant jump.” 6
Fresh business surveys pointed the same way. Britain’s preliminary composite PMI fell to 51.0 in March from 53.7, while factory input costs rose at the fastest pace since 1992, driven by fuel and transport bills. Paul Dales at Capital Economics said the conflict was already “boosting inflation and extinguishing GDP growth.” For National Grid, that leaves the stock caught between firmer earnings visibility and a harsher rates backdrop. 7
