CMS Energy (CMS) AI Stock Analysis

• Market Cap: $21.18B
• Dividend Yield: 3.06%
• Average Volume (3M): 2.36M
• Price to Earnings (P/E): 20.9
• Beta (1Y): 0.09
• Revenue Growth: 5.87%
• EPS Growth: 3.59%
• Country: US
• Employees: 8,324
• Sector: Utilities
• Sector Strength: 84
• Industry: Regulated Electric
• EPS (TTM): 1.02
• Shares Outstanding: 299,123,750
• 10 Day Avg. Volume: 2,914,059
• 30 Day Avg. Volume: 2,364,720
• PEG Ratio: 1.62
• Price to Book (P/B): 2.61
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -11.28
• Enterprise Value/Market Cap: 1.59
• Enterprise Value/Revenue: 1.11
• Enterprise Value/Gross Profit: 11.03
• Enterprise Value/Ebitda: 2.78
• 1Y Price Target: $78.27
• Price Target Upside: 10.97% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 72 Outperform
• Price Target: $78.00 ▲(10.59%Upside)

CMS Energy's overall stock score reflects its robust financial performance and strategic initiatives. While technical indicators show a neutral stance, the company's solid earnings guidance and corporate restructuring provide a positive outlook. The main risks include cash flow management and potential legislative impacts.

Positive Factors

Earnings

The unanimous approval by the Michigan PSC suggests a supportive environment for CMS Energy's future plans.

Financial Performance

CMS Energy's price objective has been raised to $80 from $73, reflecting a positive valuation outlook.

Growth Outlook

CMS shares outperformed peers due to an 18% increase to its 5-year capital plan driven by clean energy generation and distribution investments.

Negative Factors

Equity Dilution

Manageable external equity program is resulting in about 2.2-2.4% average annual dilution relative to 1.7% previously.

Regulatory Pressure

Higher customer costs could increase regulatory pressure on affordability at the utility, impacting earnings.

Tax Credit Risk

There is a sizable tax credit transferability risk if the IRA is fully repealed, particularly affecting NorthStar.

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 utility operations under Consumers Energy. The company's key revenue streams include the sale of electricity and natural gas to its customer base across Michigan. Revenue is earned from regulated electric and gas rates approved by the Michigan Public Service Commission (MPSC), which ensures the company can recover its operational costs and earn a reasonable return on its investments. Additionally, CMS Energy benefits from infrastructure investments aimed at enhancing grid reliability, integrating renewable energy sources, and improving energy efficiency. The company's earnings are influenced by factors such as regulatory decisions, weather conditions, fuel costs, and customer usage patterns.

CMS Energy Financial Statement Overview

Summary

CMS Energy demonstrates strong revenue growth and profitability metrics, with stable equity and moderate leverage. However, the negative free cash flow indicates potential liquidity challenges due to high capital expenditures.

Income Statement

CMS Energy shows a strong financial performance with consistent revenue growth, demonstrated by a 4% increase in TTM revenue compared to the previous year. The company maintains a healthy gross profit margin at 57.14% and an improved net profit margin standing at 13.10% for TTM. However, EBIT and EBITDA margins have shown slight fluctuations, indicating potential operational challenges.

Balance Sheet

The balance sheet reflects a stable financial position with a noteworthy equity growth, reaching $11.6 billion in TTM. The debt-to-equity ratio is moderate at 0.97, suggesting a balanced capital structure. Return on Equity (ROE) has improved to 8.77%, indicating efficient use of equity to generate profits. However, the equity ratio stands at 32.34%, showing room for improvement in asset financing.

Cash Flow

CMS Energy's cash flow position is mixed. The operating cash flow to net income ratio is robust at 2.37, indicating strong cash generation capabilities. However, the free cash flow is negative at -$75 million for TTM, primarily due to high capital expenditures, suggesting potential liquidity challenges if not addressed.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
7.79B	7.51B	7.46B	8.60B	7.33B	6.68B
	Gross Profit
3.04B	3.21B	2.86B	2.76B	2.65B	2.77B
	EBIT
1.57B	1.49B	1.24B	295.00M	209.00M	398.00M
	EBITDA
3.15B	3.07B	2.78B	2.55B	2.44B	2.36B
	Net Income Common Stockholders
1.02B	1.00B	887.00M	837.00M	728.00M	755.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
465.00M	103.00M	227.00M	164.00M	452.00M	168.00M
	Total Assets
36.30B	36.51B	33.52B	31.35B	28.75B	29.67B
	Total Debt
16.97B	16.57B	15.64B	15.43B	12.47B	15.20B
	Net Debt
16.50B	16.46B	15.42B	15.26B	12.02B	15.03B
	Total Liabilities
27.37B	27.17B	25.39B	23.76B	21.57B	23.59B
	Stockholders Equity
8.34B	8.23B	7.54B	7.01B	6.63B	5.50B
Cash Flow		Free Cash Flow
-844.00M	-808.00M	-265.00M	-1.63B	-390.00M	-1.17B
	Operating Cash Flow
2.41B	2.37B	2.31B	855.00M	1.82B	1.28B
	Investing Cash Flow
-3.33B	-3.05B	-3.39B	-2.48B	-1.23B	-2.87B
	Financing Cash Flow
586.00M	614.00M	1.14B	1.32B	-295.00M	1.62B

CMS Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 70.53
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 70.53 is above the 20-day moving average (MA) of 70.24, below the 50-day MA of 71.24, and above the 200-day MA of 69.00, indicating a neutral trend. The MACD of -0.28 indicates Negative momentum. The RSI at 50.05 is Neutral, neither overbought nor oversold. The STOCH value of 71.58 is Neutral, 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
CMS	72 Outperform	$21.18B	20.87	12.53%	3.06%	5.87%	3.59%
FE	72 Outperform	$23.47B	21.46	8.69%	4.38%	7.92%	1.54%
ES	71 Outperform	$24.08B	28.30	5.63%	4.57%	10.82%	―
PPL	71 Outperform	$24.97B	25.22	7.00%	3.17%	5.62%	30.02%
CNP	67 Neutral	$23.52B	24.22	9.22%	2.42%	4.76%	4.08%
EIX	67 Neutral	$19.38B	6.86	17.93%	6.57%	5.36%	209.92%
Sector *	64 Neutral	$8.62B	10.39	4.24%	4.63%	4.07%	-13.04%

CMS Energy Corporate Events

CMS Energy Director Kurt Darrow Announces Retirement

On June 5, 2025, Kurt Darrow announced his retirement from the Boards of Directors of CMS Energy Corporation and Consumers Energy Company, effective July 1, 2025. His departure is based on personal reasons and not due to any disagreements with the companies. The Boards and management expressed their gratitude for his service and contributions.

The most recent analyst rating on (CMS) stock is a Buy with a $77.00 price target. To see the full list of analyst forecasts on CMS Energy stock, see the CMS Stock Forecast page.

CMS Energy Announces $125M Debt Tender Offer

On June 4, 2025, CMS Energy announced a cash tender offer to purchase up to $125 million of outstanding debt securities issued by Consumers Energy Company. This move is part of a strategic financial maneuver to manage its debt portfolio, potentially impacting its financial stability and market perception. The tender offer, set to expire on July 3, 2025, is structured to prioritize certain bonds based on acceptance priority levels, allowing CMS Energy to optimize its debt structure.

The most recent analyst rating on (CMS) stock is a Buy with a $77.00 price target. To see the full list of analyst forecasts on CMS Energy stock, see the CMS Stock Forecast page.

CMS Energy Announces New Corporate Structure

On May 15, 2025, CMS Energy announced a new corporate organizational structure aimed at supporting its operational transformation and long-term strategy, effective July 1, 2025. The restructuring includes new leadership roles and business units, with a focus on enhancing customer service and operational success. This strategic move is expected to enable CMS Energy to deliver consistent results across its triple bottom line of people, planet, and prosperity, positioning the company for future growth and sustainability.

The most recent analyst rating on (CMS) stock is a Hold with a $73.00 price target. To see the full list of analyst forecasts on CMS Energy stock, see the CMS Stock Forecast page.

CMS Energy Shareholders Approve Key Proposals at Annual Meeting

At the CMS Energy 2025 annual meeting of shareholders on May 2, 2025, all board nominees were elected, and key proposals, including executive compensation and the appointment of PricewaterhouseCoopers LLP as the auditor, were approved. Additionally, a shareholder proposal supporting the ability to call special meetings received majority support. Concurrently, at the Consumers Energy 2025 annual meeting, all board nominees were also elected, and similar proposals regarding executive compensation and auditor appointment were approved, reflecting strong shareholder engagement and support.

CMS Energy Reports Q1 2025 Earnings Increase

On April 24, 2025, CMS Energy announced its first-quarter earnings for 2025, reporting an earnings per share of $1.01, up from $0.96 in 2024. The company reaffirmed its 2025 adjusted earnings guidance and expressed confidence in achieving high-end growth targets, supported by favorable outcomes in its electric rate case and ongoing customer investment projects.