If you’ve spent any time looking at the London Stock Exchange lately, you’ve probably noticed that the share price of National Grid doesn’t exactly move like a Silicon Valley tech darling. It’s slower. More deliberate. Honestly, it’s often about as exciting as watching a tea kettle reach a boil. But for a specific kind of investor, that’s exactly the point.
Lately, though, things have been different. The "boring" utility giant is currently in the middle of a massive £60 billion identity shift.
The market has been reacting to a whirlwind of rights issues, regulatory shifts from Ofgem, and a leadership change that saw Zoë Yujnovich take the helm in late 2025. If you're holding these shares or thinking about it, you're likely wondering if the dividend is still the fortress it used to be. Or if the company has bitten off more than it can chew with the "Great Grid Upgrade."
The Elephant in the Room: That 2024 Rights Issue
You can't talk about the current price without looking back at May 2024. National Grid did something that rattled a lot of retail investors: a £7 billion rights issue. Basically, they asked shareholders for more cash to fund their massive infrastructure plans.
Shares dropped hard.
It was a classic "short-term pain for long-term gain" play, but it diluted the existing stock. When a company issues over a billion new shares at a 35% discount, the price is going to take a hit. Fast forward to January 2026, and we are finally seeing the "new normal" for the stock.
The stock has been hovering around the 1,200p mark in London (and roughly $80 for the ADRs on the NYSE) as of mid-January 2026. What’s interesting is that while the price has recovered from those post-rights-issue lows, the market is still pricing in a lot of "show me" energy. Investors want to see those billions of pounds in capital investment actually turn into regulated earnings.
Why the Dividend Isn't What It Used to Be (But That's Okay)
National Grid used to be the ultimate "widows and orphans" stock because of its predictable dividend.
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Then the rebase happened.
Following the 2024 rights issue, the dividend was "rebased"—a polite corporate way of saying it was adjusted downward to reflect the higher number of shares in circulation. For the 2025/26 fiscal year, the interim dividend was set at 16.35p, paid out just a few days ago on January 13, 2026.
If you're looking at the yield, it's sitting around 3.8% to 4%.
That might feel low if you remember the 5% or 6% yields of yesteryear. But here’s the kicker: the company is now targeting 6–8% compound annual growth in underlying earnings per share (EPS). They aren't just a stagnant utility anymore; they're trying to grow.
Ofgem and the RIIO-T3 Factor
Regulation is the invisible hand that moves the share price of National Grid. In December 2025, the UK energy regulator, Ofgem, dropped its Final Determination for the RIIO-T3 framework.
This is basically the rulebook for how much money National Grid is allowed to make from its UK electricity transmission business between April 2026 and 2031.
Ofgem set the allowed cost of equity at 6.12%.
Some analysts thought this was a bit stingy. Others saw it as a fair compromise that allows for the massive investment needed to hit net-zero targets. National Grid is currently "reviewing" this package, and they'll give a formal response in March 2026.
If they decide to appeal the decision to the Competition and Markets Authority (CMA), expect some volatility. The market hates uncertainty, especially when it involves the government.
The American Side of the Atlantic
People often forget that National Grid is a massive player in the US, specifically in New York and Massachusetts.
Honestly, the US business has been a bit of a star lately.
While the UK deals with political wrangling over "The Great Grid Upgrade," the US operations have been quietly securing rate case approvals. In late 2025, they got the green light for the Niagara Mohawk (NIMO) rate case in New York. This is huge because it allows them to recover the costs of their investments much faster than in the UK.
About 75% of their planned US investment for the next five years is already approved through these rate cases. That provides a massive cushion for the share price when things get rocky in London.
Is the "Great Grid Upgrade" a Risk or a Reward?
We are talking about the largest overhaul of the electricity grid in generations.
The company is spending roughly £11 billion a year right now.
That is an insane amount of money. The risk is "execution risk." Can they actually build these substations, tunnels, and pylons on time and under budget?
John Pettigrew, the former CEO who stepped down in November 2025, spent years setting the stage for this. Now, it’s up to Zoë Yujnovich to deliver. The market is currently giving her the benefit of the doubt, mostly because the underlying operating profit for the first half of the 2026 fiscal year came in at £2.3 billion, up 13% from the year before.
What to Watch Next
If you're tracking the share price of National Grid, don't just look at the daily ticker. That's a fool's errand.
Focus on these three things instead:
- The March 2026 Response to Ofgem: If the company accepts the RIIO-T3 terms without a fight, it signals a period of regulatory calm.
- The Full Year Results in May 2026: This will be the first big test for the new CEO. Look for the "Underlying EPS" figure. They are targeting 73.3p as a baseline.
- Interest Rates: Utilities carry a lot of debt. If the Bank of England or the Fed starts cutting rates more aggressively in 2026, National Grid’s massive debt pile becomes cheaper to service, which usually sends the share price up.
National Grid isn't a stock for people looking to get rich overnight. It’s a bet on the "electrification of everything." As long as data centers for AI keep popping up and we keep plugging in electric cars, the demand for the grid isn't going anywhere.
Just don't expect it to be a smooth ride. Infrastructure is messy, expensive, and heavily regulated. But at 1,200p, it’s a very different animal than it was two years ago.
To manage your position effectively, you should verify your current dividend reinvestment (DRIP) settings, as the "scrip" dividend option can be a tax-efficient way to slowly increase your stake without paying brokerage fees. Keep a close eye on the March regulatory update, as any shift in the "allowed return" will directly impact the company's valuation models used by major institutional banks.