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Centerpoint Energy Inc (CNP)
:CNP
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Centerpoint Energy
(NYSE:CNP)
Rating:67Neutral
Price Target:
$41.00
▲(6.66% Upside)
Positive Factors
Cash Flow
The cash flow profile of Centerpoint Energy Inc is increasingly robust, fueled by potential further gas LDC sale and mobile gen asset extension/resell.
Financial Performance
Management reaffirmed full-year guidance range of $1.74-1.76 and its expectation for growth of 8% in 2025 and to be at the mid- to high end of 6-8% annually thereafter through 2030.
Growth Opportunities
Further upside growth opportunities from an additional $3bn of incremental transmission capital not in its plan.
Negative Factors
Equity Issuance
Management alluded to the potential to avoid incremental equity issuance through 2030, depending on capex and transaction price of the Ohio gas LDC.
Valuation Concerns
Analyst maintains a Neutral rating on CNP given leading valuation and comparatively weak balance sheet, despite attractive organic growth.
Centerpoint Energy (CNP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$25.10B
Dividend Yield2.21%
Average Volume (3M)5.19M
Price to Earnings (P/E)26.8
Beta (1Y)0.24
Revenue Growth4.84%
EPS Growth-11.24%
CountryUS
Employees8,872
SectorUtilities
Sector Strength87
IndustryGeneral Utilities
Share Statistics
EPS (TTM)0.29
Shares Outstanding652,864,870
10 Day Avg. Volume4,329,853
30 Day Avg. Volume5,189,801
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 Cap1.82
Enterprise Value/Revenue6.48
Enterprise Value/Gross Profit15.09
Enterprise Value/Ebitda14.83
Forecast
1Y Price Target
$40.00Price Target Upside4.06% Upside
Rating ConsensusHold
Number of Analyst Covering12
Centerpoint Energy Business Overview & Revenue Model
Company DescriptionCenterPoint Energy, Inc. (CNP) is a publicly traded energy company based in Houston, Texas. It operates in the utility sector, primarily providing electric and natural gas services to residential, commercial, and industrial customers. The company is involved in the generation, transmission, and distribution of electricity and natural gas, serving millions of customers across several states, including Texas, Indiana, and Louisiana. CenterPoint Energy also has a growing presence in the renewable energy sector, focusing on sustainable energy solutions.
How the Company Makes MoneyCenterPoint Energy generates revenue through multiple streams, primarily by providing utility services. The main revenue sources include regulated electric and natural gas distribution, where the company charges customers based on usage and rates set by public utility commissions. Additionally, CenterPoint earns money from the sale of electric generation and transmission services, as well as natural gas procurement and transportation. The company also participates in infrastructure projects, such as the development of renewable energy sources, which can provide additional revenue through long-term contracts and partnerships. Key partnerships with energy suppliers and investments in technology for smart grids further enhance its revenue potential. Regulatory approvals and rate adjustments are critical factors that influence its financial performance.
Centerpoint Energy Earnings Call Summary
Earnings Call Date:Jul 24, 2025
(Q2-2025)
| % Change Since: 3.56%|
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a generally positive outlook due to strong growth in the Houston Electric service territory, significant increases in the capital investment plan, and efficient recycling of assets from the Ohio Gas LDC sale. However, there are challenges with a decrease in year-over-year non-GAAP EPS, ongoing regulatory hurdles, and increased interest expenses. The sentiment is balanced by the expectation of improved operating cash flows and positive EPS guidance.Q2-2025 Updates
Positive Updates
Strong Growth in Houston Electric Service Territory
The Houston Electric service territory continues to experience robust growth, with a forecasted peak load increase of 10 gigawatts by 2031, representing a nearly 50% increase in peak demand over the next six years. This growth is driven by diverse economic drivers such as data centers, advanced manufacturing, and energy exports.
Increase in Capital Investment Plan
Announcement of an additional $500 million increase to the 2025 capital investment plan, bringing the total increase to $5.5 billion this year, with no need for additional common equity. The plan now stands at $53 billion through 2030.
Recycling of Ohio Gas LDC Sale Proceeds
The proposed sale of the Ohio Gas LDC is expected to efficiently recycle cash proceeds to support increasing investment programs in Texas, allowing for a reprioritization of nearly $1 billion in capital expenditures through 2030.
Improved Operating Cash Flow
Operating cash flow is expected to improve by 5% beginning next year, enhancing the ability to self-fund capital investments without the need for additional common equity.
Positive Non-GAAP EPS Guidance
Reaffirmation of 2025 non-GAAP EPS guidance range of $1.74 to $1.76, equating to 8% growth at the midpoint from 2024.
Negative Updates
Decrease in Non-GAAP EPS Year-over-Year
Non-GAAP EPS for Q2 2025 was $0.29, down from $0.36 in Q2 2024, due to unfavorable variances in O&M and interest expenses.
Regulatory and Cost Recovery Challenges
Ongoing regulatory proceedings and cost recovery processes, such as the Beryl and May storm cost recoveries, are still in progress, with an emphasis on securing settlements and financing orders.
Interest and Financing Costs Increase
Interest expense and financing costs were $0.03 unfavorable compared to Q2 2024, driven by increased debt issuances.
Company Guidance
During the CenterPoint Energy Second Quarter 2025 Earnings Conference Call, the company provided detailed guidance on their financial performance and strategic initiatives. CenterPoint reported a non-GAAP earnings per share (EPS) of $0.29 for Q2 2025, aligning with their full-year guidance range of $1.74 to $1.76, which represents an 8% growth from the 2024 non-GAAP EPS of $1.62. The company reaffirmed its long-term non-GAAP EPS growth expectations at the mid-to-high end of 6% to 8% annually through 2030. CenterPoint announced a $500 million increase to its capital investment plan for 2025, bringing the total to $5.5 billion in capital increases for the year, without the need for additional common equity. This investment is part of a broader $53 billion capital plan through 2030, driven by strong growth in their Houston Electric service territory, where they anticipate a nearly 50% increase in peak demand by 2031. Additionally, CenterPoint plans to recycle capital through the proposed sale of their Ohio Gas LDC, which is expected to contribute to a reprioritization of nearly $1 billion in capital expenditures towards their Texas jurisdictions.Centerpoint Energy Financial Statement Overview
Summary
Centerpoint Energy has stable income margins but faces challenges in revenue growth and cash flow due to high capital expenditures. The balance sheet is strong with low leverage. Overall, financial performance is stable, but cash flow and growth concerns need addressing.Income Statement
Centerpoint Energy has experienced fluctuating revenues with a recent decline in the TTM period. The gross profit margin is healthy at approximately 47.34% for TTM. Net profit margin is also strong at 16.03% in TTM. However, there is a noticeable drop in revenue and net income compared to the previous year, indicating a potential concern in revenue growth. The EBIT margin and EBITDA margin are stable, reflecting efficient operations.70
Positive
Balance Sheet
The company's debt-to-equity ratio stands at 0.17 in TTM, indicating a relatively low leverage. Return on equity is modest at 8.82% in TTM, suggesting reasonable profitability. The equity ratio is not calculable due to missing total assets in the TTM period, but historical data shows a steady equity position. Overall, the balance sheet reflects a stable financial structure with manageable debt levels.65
Positive
Cash Flow
Free cash flow is negative at -$2.695 billion in TTM, marking a concern for cash flow stability. Operating cash flow to net income ratio is 2.08 in TTM, showing strong cash generation relative to net income. However, the significant capital expenditures impact cash reserves negatively. The free cash flow to net income ratio is also negative, highlighting challenges in converting income to cash.50
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.04B | 8.64B | 8.70B | 9.32B | 8.35B | 7.42B |
| Gross Profit | 3.02B | 3.98B | 3.69B | 3.40B | 3.21B | 2.93B |
| EBITDA | 3.08B | 3.49B | 3.19B | 3.23B | 2.62B | 2.28B |
| Net Income | 936.00M | 1.02B | 917.00M | 1.06B | 668.00M | -591.00M |
Balance Sheet | ||||||
| Total Assets | 44.10B | 43.77B | 39.72B | 38.55B | 37.68B | 33.47B |
| Cash, Cash Equivalents and Short-Term Investments | 776.00M | 585.00M | 631.00M | 584.00M | 1.67B | 1.02B |
| Total Debt | 21.62B | 20.96B | 18.62B | 16.86B | 16.10B | 13.44B |
| Total Liabilities | 33.08B | 33.10B | 30.05B | 28.50B | 28.26B | 25.12B |
| Stockholders Equity | 11.02B | 10.67B | 9.67B | 10.04B | 9.41B | 8.35B |
Cash Flow | ||||||
| Free Cash Flow | -3.12B | -2.37B | -524.00M | -2.61B | -3.14B | -601.00M |
| Operating Cash Flow | 1.69B | 2.14B | 3.88B | 1.81B | 22.00M | 2.00B |
| Investing Cash Flow | -3.22B | -4.49B | -4.23B | -1.63B | -1.85B | -1.26B |
| Financing Cash Flow | 2.78B | 2.27B | 374.00M | -345.00M | 1.92B | -834.00M |
Centerpoint Energy Technical Analysis
Positive
38.44
Price Trends
37.06
Positive
37.04
Positive
34.47
Positive
Market Momentum
0.48
Positive
56.03
Neutral
35.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CNP, the sentiment is Positive. The current price of 38.44 is above the 20-day moving average (MA) of 38.30, above the 50-day MA of 37.06, and above the 200-day MA of 34.47, indicating a bullish trend. The MACD of 0.48 indicates Positive momentum. The RSI at 56.03 is Neutral, neither overbought nor oversold. The STOCH value of 35.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CNP.
Centerpoint Energy Risk Analysis
Centerpoint Energy disclosed 16 risk factors in its most recent earnings report. Centerpoint Energy reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Centerpoint Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (56)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $21.79B | 21.49 | 12.48% | 2.95% | 8.25% | 4.37% | |
72 Outperform | $21.56B | 8.23 | 17.37% | 5.82% | 4.26% | 173.18% | |
72 Outperform | $25.21B | 19.27 | 10.33% | 3.99% | 6.44% | 49.07% | |
71 Outperform | $24.31B | 28.20 | 5.63% | 4.48% | 14.44% | ― | |
71 Outperform | $27.42B | 27.88 | 6.96% | 2.86% | 6.62% | 17.35% | |
67 Neutral | $25.10B | 26.79 | 8.76% | 2.21% | 4.84% | -11.24% | |
56 Neutral | AU$1.98B | 1.72 | 5.21% | 4.09% | 24.08% | -117.07% |
* Utilities Sector Average
Performance Comparison
CNP
Centerpoint Energy
38.44
13.14
51.94%
CMS
CMS Energy
72.59
8.12
12.60%
EIX
Edison International
56.02
-23.26
-29.34%
FE
FirstEnergy
43.66
2.82
6.90%
ES
Eversource Energy
65.51
3.41
5.49%
PPL
PPL
37.08
6.89
22.82%
Centerpoint Energy Corporate Events
Private Placements and Financing
CenterPoint Energy Completes $1 Billion Convertible Notes Sale
Neutral
Jul 31, 2025
On July 31, 2025, CenterPoint Energy, Inc. completed the sale of $1 billion in 3.00% Convertible Senior Notes due 2028. The Notes were sold in a private offering and are convertible under certain conditions, with a conversion rate initially set at 21.4477 shares of common stock per $1,000 principal amount of Notes. The Notes will mature on August 1, 2028, unless converted or repurchased earlier.
The most recent analyst rating on (CNP) stock is a Buy with a $31.00 price target. To see the full list of analyst forecasts on Centerpoint Energy stock, see the CNP Stock Forecast page.
Business Operations and StrategyFinancial Disclosures
CenterPoint Energy Reports Q2 2025 Earnings
Neutral
Jul 24, 2025
On July 24, 2025, CenterPoint Energy reported its second quarter 2025 earnings, highlighting a net income of $198 million, or $0.30 per diluted share on a GAAP basis, compared to $0.36 in the same period of 2024. The company increased its 10-year capital investment plan by $500 million, reaching a total of $53 billion through 2030, and reiterated its 2025 non-GAAP EPS guidance. CenterPoint also accomplished all commitments related to Phase II of the Greater Houston Resiliency Initiative ahead of schedule, resulting in a significant reduction in outage minutes for customers.
The most recent analyst rating on (CNP) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on Centerpoint Energy stock, see the CNP Stock Forecast page.
Business Operations and Strategy
Centerpoint Energy Invests in Renewable Energy Projects
Positive
Jul 2, 2025
Centerpoint Energy announced a strategic initiative to enhance its infrastructure by investing in renewable energy projects. This move is expected to bolster the company’s commitment to sustainability and improve its competitive position in the energy market.
The most recent analyst rating on (CNP) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on Centerpoint Energy stock, see the CNP Stock Forecast page.
Private Placements and Financing
CenterPoint Energy Finalizes Major Stock Sale Agreement
Neutral
May 29, 2025
On May 27, 2025, CenterPoint Energy entered into an Underwriting Agreement with BofA Securities, Mizuho Securities, and J.P. Morgan Securities, involving the sale of 21,621,622 shares of its common stock, with an option for an additional 3,243,243 shares, which was exercised on May 28, 2025. The agreements, including forward sale agreements with forward purchasers, allow for settlement by February 2027 and involve potential impacts on the company’s earnings per share and market price, depending on how the forward sale agreements are settled.
The most recent analyst rating on (CNP) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on Centerpoint Energy stock, see the CNP Stock Forecast page.
Private Placements and FinancingBusiness Operations and Strategy
CenterPoint Energy Enters Forward Sale Agreements
Neutral
May 28, 2025
On May 27, 2025, CenterPoint Energy entered into forward sale agreements with Bank of America, Mizuho Markets Americas, and JPMorgan Chase, involving 21,621,622 shares of its common stock. This strategic move, which includes an underwriting agreement with major financial institutions, is aimed at enhancing liquidity and potentially impacting the company’s earnings per share due to potential dilution. The agreements allow for flexible settlement options, including physical, net share, or cash settlement, and could influence the market price of the company’s stock depending on future stock valuations.
The most recent analyst rating on (CNP) stock is a Hold with a $28.00 price target. To see the full list of analyst forecasts on Centerpoint Energy stock, see the CNP Stock Forecast page.
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.