CMS Energy (CMS) AI Stock Analysis

• Market Cap: $23.51B
• Dividend Yield: 3.1%
• Average Volume (3M): 3.08M
• Price to Earnings (P/E): 21.8
• Beta (1Y): >-0.01
• Revenue Growth: 10.96%
• EPS Growth: -0.77%
• Country: US
• Employees: 8,324
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Electric
• EPS (TTM): 0.95
• Shares Outstanding: 306,420,900
• 10 Day Avg. Volume: 3,537,082
• 30 Day Avg. Volume: 3,078,345
• PEG Ratio: 3.45
• Price to Book (P/B): 2.30
• Price to Sales (P/S): 2.46
• P/FCF Ratio: 9.40
• Enterprise Value/Market Cap: 1.78
• Enterprise Value/Revenue: 5.04
• Enterprise Value/Gross Profit: 12.97
• Enterprise Value/Ebitda: 12.55
• 1Y Price Target: $80.11
• Price Target Upside: 4.39% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: $78.00 ▲(1.64% Upside)

The score is anchored by mixed fundamentals: steady profitability and improving operating cash flow are offset by elevated/rising leverage and a history of negative free cash flow, with some 2025 data inconsistencies adding uncertainty. Offsetting this, technicals are constructive and the latest earnings call was positive on raised guidance and a robust regulated investment pipeline, while valuation is reasonable but not particularly cheap.

Positive Factors

Regulated Franchise / Market Position

A dominant regulated utility franchise in Michigan provides durable, rate‑regulated cash flows and high customer stickiness. The monopoly nature of Consumers Energy limits competition, supports predictable demand and recovery mechanisms, and underpins long-term earnings stability and capital planning visibility.

Large Investment Plan / Rate‑Base Growth

A $24B five‑year investment plan and mid‑teens rate‑base growth underpin multi‑year earnings growth via regulatory recovery. Sustained capital deployment into distribution, generation and renewables should create stable allowed returns and predictable rate relief opportunities across the regulatory cycle.

Operational Cash Flow & Earnings Momentum

Record adjusted EPS and upward guidance reflect operational execution and translate to durable earnings momentum. Coupled with improving operating cash flow trends (per cash flow summary), this supports funding of capex, preserves credit metrics and enables targeted dividend growth over the medium term.

Negative Factors

Elevated Leverage

Rising absolute debt and a high debt/equity profile increase refinancing and interest rate sensitivity. Heavy leverage limits financial flexibility for additional projects, raises refinancing and covenant risk, and constrains ability to absorb regulatory setbacks without incremental equity or higher financing costs.

Persistent Negative Free Cash Flow / Data Volatility

Chronic negative free cash flow from heavy capex drives ongoing external funding needs and dilutive equity issuance risk. The 2025 FCF reporting inconsistency reduces confidence in cash conversion forecasts, complicating medium‑term funding and dividend planning assumptions.

Regulatory Outcome Uncertainty

An adverse preliminary ROE recommendation directly pressures returns on new rate‑base investments, compressing allowed returns and long‑run profitability. Protracted rate cases increase timing risk for recovery and can necessitate higher equity issuance or defer projects, weakening structural earnings growth.

CMS Energy Business Overview & Revenue Model

Company Description

CMS Energy Corporation operates as an energy company primarily in Michigan. The company operates through three segments: Electric Utility; Gas Utility; and Enterprises. The Electric Utility segment is involved in the generation, purchase, transmission, distribution, and sale of electricity. This segment generates electricity through coal, wind, gas, renewable energy, oil, and nuclear sources. Its distribution system comprises 208 miles of high-voltage distribution overhead lines; 4 miles of high-voltage distribution underground lines; 4,428 miles of high-voltage distribution overhead lines; 19 miles of high-voltage distribution underground lines; 82,474 miles of electric distribution overhead lines; 9,395 miles of underground distribution lines; 1,093 substations; and 3 battery facilities. The Gas Utility segment engages in the purchase, transmission, storage, distribution, and sale of natural gas, which includes 2,392 miles of transmission lines; 15 gas storage fields; 28,065 miles of distribution mains; and 8 compressor stations. The Enterprises segment is involved in the independent power production and marketing, including the development and operation of renewable generation. It serves 1.9 million electric and 1.8 million gas customers, including residential, commercial, and diversified industrial customers. The company was incorporated in 1987 and is headquartered in Jackson, Michigan.

How the Company Makes Money

CMS Energy generates revenue primarily through its regulated utility business, Consumers Energy, which earns money by providing electricity and natural gas services. This revenue is derived from customer bills, which are regulated by state authorities to ensure fair pricing and service reliability. The company also benefits from long-term contracts and partnerships in its non-regulated segment, CMS Enterprises, which involve renewable energy projects and energy marketing. Additionally, CMS Energy invests in infrastructure improvements and renewable energy initiatives, which can further enhance its revenue through incentives and subsidies. The company’s financial performance is bolstered by its focus on operational efficiency and customer service, ensuring a stable and growing customer base.

CMS Energy Financial Statement Overview

Summary

Income statement trends are steady with solid utility-like profitability, but the balance sheet shows rising leverage and the cash-flow profile is pressured by historically negative free cash flow. Data quality gaps and inconsistencies (missing/zero 2025 margin/leverage fields and a flagged 2025 FCF inconsistency) reduce confidence and weigh on the score.

Income Statement

Revenue has been broadly stable with a return to growth in 2024 (~+0.7%) and a stronger step-up in 2025 (~+2.9%) after a 2023 decline. Profitability is solid for a regulated utility, with net margin generally in the low-to-mid teens (about 11.9% in 2023, 13.3% in 2024, and 12.5% in 2025). EBITDA margin improved meaningfully versus 2022 and remains healthy. Key weakness: several 2025 margin fields (gross and EBIT margins) appear missing/zero in the data, limiting confidence in trend analysis for those line items.

Balance Sheet

Leverage is elevated and rising: total debt increased from ~$12.4B (2020) to ~$19.0B (2025). Where available, debt relative to equity runs around ~1.9–2.3x (2020–2024), which is high but not unusual for regulated utilities. Equity has grown steadily (from ~$5.5B in 2020 to ~$8.9B in 2025), helping support asset growth, and returns on equity were steady around ~12% in 2022–2024 (with 2021 higher). Main concern is the continued debt build and missing/zero leverage and return fields in 2025, which reduces visibility into current balance-sheet quality.

Cash Flow

Operating cash flow is generally strong and improving (from ~$1.28B in 2020 to ~$2.31B–$2.37B in 2023–2024 and ~$2.24B in 2025). However, free cash flow has been persistently negative in most years (2020–2024), consistent with heavy capital spending needs; free cash flow was notably weak in 2022–2024 (about -$1.52B, -$0.91B, and -$0.65B). 2025 shows positive free cash flow (~$2.24B) and a 1.0x conversion of free cash flow to net income, but the reported free cash flow growth is sharply negative (-248%), creating a data consistency red flag and suggesting volatility or classification changes.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	8.29B	8.54B	7.51B	7.46B	8.60B	7.33B
Gross Profit	3.22B	5.20B	3.21B	2.86B	2.76B	2.65B
EBITDA	3.33B	3.19B	3.07B	2.78B	2.55B	2.44B
Net Income	1.05B	1.07B	1.00B	887.00M	837.00M	1.35B
Balance Sheet
Total Assets	38.01B	40.39B	35.92B	33.52B	31.35B	28.75B
Cash, Cash Equivalents and Short-Term Investments	362.00M	615.00M	103.00M	227.00M	164.00M	452.00M
Total Debt	18.07B	18.94B	16.59B	15.67B	14.34B	12.50B
Total Liabilities	28.58B	30.68B	27.17B	25.39B	23.76B	21.57B
Stockholders Equity	8.86B	9.14B	8.23B	7.54B	7.01B	6.63B
Cash Flow
Free Cash Flow	-1.51B	2.23B	-648.00M	-910.00M	-1.52B	-257.00M
Operating Cash Flow	2.16B	2.23B	2.37B	2.31B	855.00M	1.82B
Investing Cash Flow	-3.87B	-4.04B	-3.05B	-3.38B	-2.47B	-1.23B
Financing Cash Flow	1.68B	2.24B	609.00M	1.14B	1.32B	-296.00M

CMS Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 76.74
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CMS, the sentiment is Positive. The current price of 76.74 is above the 20-day moving average (MA) of 72.32, above the 50-day MA of 71.10, and above the 200-day MA of 71.25, indicating a bullish trend. The MACD of 1.07 indicates Negative momentum. The RSI at 75.80 is Negative, neither overbought nor oversold. The STOCH value of 93.91 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CMS.

CMS Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EIX	78 Outperform	$27.50B	9.36	19.13%	5.68%	4.43%	123.35%
AEE	68 Neutral	$30.02B	20.74	11.41%	2.86%	22.71%	22.86%
FE	67 Neutral	$28.94B	21.76	10.54%	3.94%	7.64%	48.61%
ES	66 Neutral	$27.52B	16.09	―	4.54%	13.12%	―
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
DTE	65 Neutral	$30.10B	21.71	11.64%	3.45%	19.42%	-9.68%
CMS	64 Neutral	$23.51B	21.77	12.33%	3.10%	10.96%	-0.77%

CMS Energy Corporate Events

CMS Energy boosts 2026 guidance and raises dividend

On February 5, 2026, CMS Energy reported 2025 diluted earnings per share of $3.53, up from $3.33 in 2024, with adjusted EPS rising to $3.61 from $3.34 and exceeding guidance, driven largely by strong performance at its NorthStar Clean Energy segment and solid cost control at the utility. The company raised its 2026 adjusted earnings guidance to a range of $3.83 to $3.90 per share, increased its annual dividend for 2026 by $0.11 to $2.28—marking its 20th consecutive yearly increase—and highlighted constructive regulatory outcomes and a focus on reliability and affordability, signaling ongoing earnings growth and continued support for shareholders and customers.

The most recent analyst rating on (CMS) stock is a Hold with a $79.00 price target. To see the full list of analyst forecasts on CMS Energy stock, see the CMS Stock Forecast page.

CMS Energy Expands Credit Facilities for Growth

On November 21, 2025, CMS Energy Corporation and Consumers Energy Company amended and expanded their revolving credit facilities with a consortium of banks, increasing CMS’s facility to $750 million and Consumers’ to $1.1 billion. These facilities, which have five-year terms expiring in 2030, are intended for general corporate purposes and working capital, and replace existing facilities set to expire in 2027. Additionally, Consumers entered a new $300 million secured revolving credit facility with similar terms, expiring in 2028. These financial arrangements are expected to enhance the companies’ operational flexibility and financial stability.

The most recent analyst rating on (CMS) stock is a Buy with a $82.00 price target. To see the full list of analyst forecasts on CMS Energy stock, see the CMS Stock Forecast page.