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Companhia Energetica Minas Gerais (CIG)
NYSE:CIG
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Companhia Energetica Minas Gerais
(NYSE:CIG)
Rating:79Outperform
Price Target:
$2.00
▲(1.01% Upside)
Positive Factors
Dividends
The one-offs in the net income could result in a 4% additional dividend yield.
Privatization
The privatization process is the main upside risk, potentially boosting stock value.
Negative Factors
Operational Performance
Cemig reported soft operational results with Adj. EBITDA down 10% YoY.
Privatization Complexity
There is a low likelihood of Minas Gerais state-owned enterprises' privatization concluding due to complexity.
Companhia Energetica Minas Gerais (CIG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.52B
Dividend Yield15.97%
Average Volume (3M)2.34M
Price to Earnings (P/E)5.1
Beta (1Y)0.39
Revenue Growth-3.27%
EPS Growth-3.44%
CountryUS
Employees5,028
SectorUtilities
Sector Strength64
IndustryDiversified Utilities
Share Statistics
EPS (TTM)0.08
Shares Outstanding1,905,179,900
10 Day Avg. Volume2,336,126
30 Day Avg. Volume2,335,686
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.22
Enterprise Value/Revenue0.19
Enterprise Value/Gross Profit1.00
Enterprise Value/Ebitda0.69
Forecast
1Y Price Target
$2.00Price Target Upside1.01% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Companhia Energetica Minas Gerais Business Overview & Revenue Model
Company DescriptionCompanhia Energética de Minas Gerais (CIG) is a prominent Brazilian energy company primarily engaged in the generation, transmission, and distribution of electric power. Operating mainly in the state of Minas Gerais, CIG is involved in various energy sectors, including hydroelectric, thermal, and renewable energy sources. The company provides electricity to millions of customers, both residential and commercial, and plays a crucial role in the development of energy infrastructure in Brazil.
How the Company Makes MoneyCIG generates revenue primarily through the sale of electricity to end-users, including residential, commercial, and industrial customers. The company's core revenue streams include electricity generation from its diverse power plants, which harness both renewable and non-renewable resources. Additionally, CIG earns income from the transmission and distribution of electricity across its operational regions. The company may also benefit from regulatory frameworks and agreements that allow for adjustments in tariff rates, enabling it to optimize its pricing strategy. Partnerships with governmental and private entities for energy projects and infrastructure development further contribute to its financial performance.
Companhia Energetica Minas Gerais Earnings Call Summary
Earnings Call Date:Aug 14, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Positive
The earnings call highlights significant investments and growth in adjusted EBITDA, alongside successful strategic initiatives like the GSF auction participation. However, challenges in the trading sector and noncash impacts from regulatory adjustments present some headwinds.Q2-2025 Updates
Positive Updates
Record Investment Program
Cemig is executing its largest investment program to date, with BRL 2.7 billion invested in the first half of 2025, focusing on the expansion and maintenance of infrastructure.
Adjusted EBITDA Growth
Adjusted EBITDA for the quarter reached BRL 2.2 billion, showing a robust performance and a 15% increase in recurring EBITDA compared to last year.
Successful GSF Auction Participation
Cemig secured concession extensions for three power plants in the GSF auction, adding years to their operational timeline and ensuring future sustainability.
Leverage and Debt Management
Net debt over adjusted EBITDA stands at 1.59, with a comfortable leverage position supporting the ongoing investment plan.
Positive Performance in Gasmig
Gasmig's EBITDA aligns with expectations, and net profit has increased significantly due to efficient cost management.
Negative Updates
Negative Impact from Energy Submarkets
The trading sector experienced a negative impact of BRL 76 million due to differences among energy submarkets.
Noncash Impact from RBSE Adjustments
A noncash impact of BRL 199 million was recorded due to changes in the existing system basic grid calculation methodology.
Reduction in Cemig D Energy Market
A 3.3% drop in the energy market for Cemig D was noted, mainly due to client migration to the free market.
Company Guidance
During Cemig's Second Quarter 2025 earnings call, CEO Reynaldo Passanezi Filho highlighted several key metrics reflecting the company's robust performance. Cemig reported investments totaling BRL 2.7 billion in the first half of 2025, with an adjusted EBITDA of BRL 2.2 billion, demonstrating sound operational resilience. The company faced a noncash impact of BRL 199 million related to the RBSE review and a negative BRL 76 million from energy submarket differences, which they expect to neutralize. Cemig also achieved a tariff adjustment of 7.78% and secured the extension of concessions for three power plants through a BRL 200 million GSF auction. Additionally, Cemig's CFO Andrea Marques de Almeida discussed the successful execution of their BRL 2.8 billion annual investment plan, notably energizing nine substations and expanding low and medium voltage networks by over 2,600 kilometers. The company's leverage indicator stood at 1.59, supported by a cash flow ending at BRL 3 billion, underpinned by operational cash generation and debenture issuances. These strategic efforts underscore Cemig's commitment to future growth and sustainability in the energy sector.Companhia Energetica Minas Gerais Financial Statement Overview
Summary
Companhia Energetica Minas Gerais demonstrates solid revenue growth and profitability, with a strong net profit margin and a balanced debt-to-equity position. However, there are concerns regarding declining EBITDA margins and reduced free cash flow, which could impact future financial flexibility.Income Statement
The company has shown a consistent growth in revenue over the years, with a TTM (Trailing-Twelve-Months) revenue of 39.89 billion compared to 39.82 billion in the previous annual period. Gross Profit Margin has decreased to 7.20% in the TTM from 7.90% in the last annual report, while the Net Profit Margin slightly improved to 17.56% in the TTM, indicating effective cost management. However, the EBIT and EBITDA margins have declined, suggesting potential challenges in operational efficiency.80
Positive
Balance Sheet
The company's debt-to-equity ratio is healthy at 0.56, reflecting a balanced approach to leveraging debt. The Return on Equity (ROE) for the TTM stands at 25.09%, showcasing strong profitability relative to equity. The equity ratio is at 43.67%, indicating a solid equity base. Despite these strengths, a slight increase in total liabilities suggests increased leverage, which could pose future risks.75
Positive
Cash Flow
Free Cash Flow has decreased significantly in the TTM to 1.67 billion from 4.58 billion in the previous annual period, indicating reduced cash generation capacity. The Operating Cash Flow to Net Income ratio is robust at 1.16, demonstrating good cash conversion efficiency. However, the Free Cash Flow to Net Income ratio dropped to 0.24, raising concerns about the sustainability of cash flow generation.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 40.92B | 39.82B | 36.85B | 34.46B | 33.65B | 25.23B |
| Gross Profit | 7.96B | 7.83B | 8.38B | 6.81B | 6.72B | 5.38B |
| EBITDA | 11.47B | 11.74B | 9.15B | 6.24B | 6.92B | 6.20B |
| Net Income | 7.00B | 7.12B | 5.76B | 4.09B | 3.75B | 2.86B |
Balance Sheet | ||||||
| Total Assets | 63.90B | 59.73B | 55.00B | 53.67B | 52.05B | 54.08B |
| Cash, Cash Equivalents and Short-Term Investments | 6.03B | 3.45B | 3.13B | 4.24B | 4.05B | 5.30B |
| Total Debt | 15.66B | 12.71B | 10.26B | 10.94B | 11.61B | 15.25B |
| Total Liabilities | 35.98B | 32.34B | 30.34B | 31.89B | 32.58B | 36.60B |
| Stockholders Equity | 27.91B | 27.38B | 24.65B | 21.78B | 19.46B | 17.47B |
Cash Flow | ||||||
| Free Cash Flow | 1.67B | 4.58B | 5.38B | 6.32B | 3.45B | 8.43B |
| Operating Cash Flow | 5.23B | 5.50B | 6.64B | 6.61B | 3.69B | 8.61B |
| Investing Cash Flow | -2.65B | -2.38B | -3.97B | -3.21B | 1.37B | -5.08B |
| Financing Cash Flow | -1.51B | -2.76B | -2.58B | -2.79B | -5.91B | -2.39B |
Companhia Energetica Minas Gerais Technical Analysis
Positive
1.98
Price Trends
1.91
Positive
1.84
Positive
1.77
Positive
Market Momentum
0.03
Negative
55.21
Neutral
78.56
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CIG, the sentiment is Positive. The current price of 1.98 is above the 20-day moving average (MA) of 1.95, above the 50-day MA of 1.91, and above the 200-day MA of 1.77, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 55.21 is Neutral, neither overbought nor oversold. The STOCH value of 78.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CIG.
Companhia Energetica Minas Gerais Risk Analysis
Companhia Energetica Minas Gerais disclosed 60 risk factors in its most recent earnings report. Companhia Energetica Minas Gerais reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
A member of our board of directors is party to judicial proceedings. Q4, 2022
2.
Increases in energy generated by MMGD in Cemig D's concession area could cause an imbalance in its cash flows and financial results. Q4, 2022
3.
The continuing impact of the ongoing military conflict between Russia and Ukraine, or any widening of the conflict, may have a material adverse effect on the global economy, certain material and commodity prices and potentially on our business. Q4, 2022
Companhia Energetica Minas Gerais Peers Comparison
Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $6.52B | 5.05 | 22.94% | 15.97% | -3.27% | -3.44% | |
72 Outperform | $6.34B | 12.36 | 9.81% | 6.29% | -5.28% | 14.50% | |
71 Outperform | $53.87B | 19.99 | 8.87% | 3.05% | 0.46% | -11.77% | |
71 Outperform | $6.34B | 11.34 | 9.81% | 6.29% | -5.28% | 14.50% | |
66 Neutral | $17.34B | 17.87 | 5.54% | 3.65% | 6.63% | 11.55% | |
65 Neutral | $20.52B | 1,620.62 | 1.06% | 5.39% | 8.86% | ― | |
65 Neutral | $9.64B | 9.47 | 21.17% | 5.22% | -3.19% | 30.48% |
* Utilities Sector Average
Performance Comparison
CIG
Companhia Energetica Minas Gerais
1.98
0.10
5.32%
BIP
Brookfield Infrastructure
31.44
1.57
5.26%
ELP
Companhia Paranaense de Energia Pfd
8.88
1.54
20.98%
SRE
Sempra Energy
82.89
2.12
2.62%
AES
AES
13.41
-2.58
-16.14%
ELPC
Companhia Paranaense de Energia Sponsored ADR
8.15
1.64
25.19%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.