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CMS Energy Corporation (CMS) Stock

CMS Energy Corporation Stock Details, Movements and Public Alerts

CMS Energy Corporation (CMS): The $19B Michigan Utility Powering Clean Energy Transition

CEO Garrick Rochow is leading CMS Energy through the clean energy transition, retiring coal plants and investing $17B through 2028 in solar, wind, and grid modernization. The company's Clean Energy Plan targets net-zero carbon by 2040—among the most aggressive in the utility sector. CMS serves 1.8M electric and 1.8M gas customers across Michigan's Lower Peninsula, operating as a vertically integrated monopoly under Michigan Public Service Commission regulation. Recent rate case approvals secured 10% allowed returns on equity, enabling $3-4B annual capex while maintaining 60% payout ratios. Unlike merchant power generators exposed to commodity prices, CMS earns regulated returns: invest $1B in solar farms, earn 10% annually for 30+ years. This model produces steady cash flows funding 6% annual dividend increases since 2004.

52-Week Range

$75.54 - $62.07

-6.30% from high · +14.03% from low

Avg Daily Volume

1,982,199

Latest volume

Fundamentals

Valuation Metrics

P/E Ratio (TTM)

20.16

Near market average

Forward P/E

18.12

Earnings expected to grow

PEG Ratio

2.57

Potentially overvalued

Price to Book

2.46

EV/EBITDA

11.80

EPS (TTM)

$3.46

Price to Sales

2.56

Beta

0.47

Less volatile than market

How is CMS valued relative to its earnings and growth?
CMS Energy Corporation trades at a P/E ratio of 20.16, which is near the market average of approximately 20, suggesting the market views it as fairly valued relative to its earnings. Looking ahead, the forward P/E of 18.12 is lower than the current P/E, indicating analysts expect earnings to grow over the next year. The PEG ratio of 2.57 indicates a premium valuation even accounting for growth.
What is CMS's risk profile compared to the market?
With a beta of 0.47, CMS Energy Corporation is less volatile than the overall market. This means when the market moves up or down by 10%, this stock typically moves less than 10% in the same direction. Lower beta stocks are often preferred by conservative investors seeking stability. The price-to-book ratio of 2.46 shows investors value the company above its book value, which often reflects intangible assets or growth prospects.

Performance & Growth

Profit Margin

12.60%

Operating Margin

26.20%

EBITDA

$2.99B

Return on Equity

11.20%

Return on Assets

3.25%

Revenue Growth (YoY)

16.00%

Earnings Growth (YoY)

9.20%

How profitable and efficient is CMS's business model?
CMS Energy Corporation achieves a profit margin of 12.60%, meaning it retains $12.60 from every $100 in revenue after all expenses. This represents a solid margin typical of well-run businesses, showing the company can effectively balance revenue generation with cost control. The operating margin of 26.20% reveals how efficiently the company runs its core business operations before interest and taxes. With ROE at 11.20% and ROA at 3.25%, the company achieves moderate returns on invested capital.
What are CMS's recent growth trends?
CMS Energy Corporation's revenue grew by 16.00% year-over-year, showing steady progress in growing the business. This positive trajectory indicates the company maintains competitive positioning in its markets. Earnings increased by 9.20% year-over-year, reflecting the bottom-line impact of business performance. These growth metrics should be evaluated against UTILITIES - REGULATED ELECTRIC industry averages for proper context.

Dividend Information

Dividend Per Share

$2.14

Dividend Yield

3.06%

Ex-Dividend Date

Nov 7, 2025

Dividend Date

Nov 26, 2025

What dividend income can investors expect from CMS?
CMS Energy Corporation offers a dividend yield of 3.06%, paying $2.14 per share annually. This above-average yield of 2-4% provides meaningful income while still allowing the company to reinvest for growth. It compares favorably to the S&P 500 average and offers competitive returns versus bonds in the current rate environment. To receive the next dividend, shares must be purchased before the ex-dividend date of Nov 7, 2025.
How reliable is CMS's dividend for long-term investors?
The dividend sustainability can be assessed through the payout ratio - CMS Energy Corporation pays $2.14 per share in dividends against earnings of $3.46 per share, resulting in a payout ratio of 61.94%. This high payout ratio of 60-90% leaves limited earnings for reinvestment. While currently sustainable, there's less buffer for dividend growth or protection during earnings downturns. The next dividend payment is scheduled for Nov 26, 2025.

Company Size & Market

Market Cap

$21.2B

Revenue (TTM)

$8.29B

Revenue/Share (TTM)

$27.78

Shares Outstanding

304.32M

Book Value/Share

$28.39

Asset Type

Common Stock

What is CMS's market capitalization and position?
CMS Energy Corporation has a market capitalization of $21.2B, classifying it as a large-cap stock ($10B-$200B). Large-caps are typically industry leaders with established business models, offering a balance of stability and growth potential. They often provide dividend income and are core holdings in institutional portfolios. With 304.32M shares outstanding, the company's ownership is relatively concentrated. As a participant in the UTILITIES - REGULATED ELECTRIC industry, it competes with other firms in this sector.
How does CMS's price compare to its book value?
CMS Energy Corporation's book value per share is $28.39, while the current stock price is $70.78, resulting in a price-to-book (P/B) ratio of 2.49. This reasonable premium to book value suggests the market values the company's earnings power and intangible assets appropriately. Most profitable companies trade between 1-3x book value. As a common stock, this represents equity ownership with voting rights.

Analyst Ratings

Analyst Target Price

$78.23

10.53% upside potential

Analyst Recommendations

Strong Buy

3

Buy

5

Hold

7

Sell

0

Strong Sell

1

How reliable are analyst predictions for CMS?
16 analysts cover CMS with 50% recommending buy/strong buy ratings. Analyst predictions have mixed reliability - studies show consensus rarely beats market returns consistently. The mixed views reflect uncertainty about the outlook. The consensus target of $78.23 implies 10.5% upside, but targets are often adjusted to follow price moves rather than predict them.
What is the Wall Street consensus on CMS?
Current analyst recommendations:3 Strong Buy, 5 Buy, 7 Hold, 01 Strong Sell. The neutral stance suggests uncertainty or fair valuation at current levels.Remember that analyst opinions often lag price movements and can be influenced by investment banking relationships.

Fundamentals last updated: Dec 13, 2025, 08:20 AM

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CMS Energy Corporation (CMS) Stock Analysis 2025: Complete Investment Guide

Michigan's Clean Energy Monopoly

Garrick Rochow took over CMS in 2021 with a mandate: decarbonize Michigan's power while maintaining affordability and reliability. CMS owns the entire value chain—generation (coal, gas, renewables), transmission lines, and distribution to 1.8M homes and businesses. This vertical integration, combined with monopoly service territories granted by Michigan regulators, creates a regulated asset base earning 10% annual returns. Rochow's $17B investment plan through 2028 focuses on replacing retiring coal plants (Karn, Campbell) with 8 GW of solar and wind, plus grid upgrades handling intermittent renewables. Each dollar invested grows the rate base, which regulators allow CMS to earn 10% returns on—a compounding machine if capital is deployed efficiently.

Business Model & Competitive Moat

CMS earns regulated returns: regulators set allowed ROE (currently 9.9%), CMS invests capital, and rates adjust to deliver that return. The moat is regulatory franchise—no competitor can serve CMS's 3.6M customers without decades of regulatory battles. Earnings are 90% from regulated electric/gas utilities, 10% from non-utility investments. Revenue grows via: (1) Rate base expansion (7-8% annually from $17B capex), (2) Customer growth (0.5% annually in Michigan), (3) Rate case increases (covering inflation). This model is defensive but slow—no explosive growth, but near-certain 6-7% EPS compounding.

Financial Performance

  • •Revenue: $8.9B TTM with 3-4% annual growth from rate base expansion
  • •EPS Growth: $3.55 2024E growing to $4.70 by 2028—6-7% CAGR guidance
  • •Dividend: $2.06/share (3% yield) with 60% payout ratio supporting 6% annual increases
  • •Rate Base: $23B growing to $32B by 2028 via $17B capex—foundation for earnings
  • •Credit Rating: BBB+ (S&P) with 50% equity/50% debt capital structure

Growth Catalysts

  • •Renewable Buildout: 8 GW solar/wind by 2040 requiring $12B+ investment at 10% regulated returns
  • •Grid Modernization: Smart meters, distribution automation, EV charging infrastructure adding $2B to rate base
  • •Rate Case Wins: Recent approval of 9.9% ROE vs. 9.5% industry average—premium returns for investors
  • •Michigan Economy: Auto industry resurgence (EV manufacturing) driving industrial electricity demand growth
  • •Gas Distribution Growth: Natural gas conversions and infrastructure replacements providing steady capex opportunities

Risks & Challenges

  • •Regulatory Risk: Michigan PSC could deny rate increases, cut allowed ROE, or mandate customer refunds
  • •Coal Retirement Costs: Accelerating plant closures may force asset write-downs or stranded cost recovery battles
  • •Weather Sensitivity: Mild winters reduce gas heating demand; cool summers lower A/C electricity use
  • •Renewable Intermittency: Integrating 8 GW solar/wind requires battery storage, grid reinforcement—costly, uncertain economics
  • •Political Risk: Michigan elections could bring anti-utility politicians capping rates or blocking investments

Competitive Landscape

CMS faces no direct competition—regulated monopoly in its service territory. However, it competes with DTE Energy (Detroit-area rival, 2.2M customers) for regulatory favorability and with national utilities like Duke Energy, Southern Company for investor capital. CMS differentiates through aggressive clean energy commitments (net-zero by 2040 vs. 2050 for most peers) and consistent execution (20+ years dividend growth). The risk: distributed generation (rooftop solar + batteries) could erode utility revenue long-term, though Michigan's net metering caps limit impact.

Who Is This Stock Suitable For?

Perfect For

  • ✓Income investors seeking 3% yield with 6% annual dividend growth
  • ✓Retirees needing stable, predictable cash flows from defensive sector
  • ✓ESG investors prioritizing clean energy transition (net-zero 2040 target)
  • ✓Conservative portfolios wanting inflation-protected infrastructure exposure

Less Suitable For

  • ✗Growth investors (6-7% EPS growth is slow)
  • ✗Yield hunters (3% dividend is modest)
  • ✗Traders (low volatility, moves with interest rates)
  • ✗Anti-regulation investors uncomfortable with government-set returns

Investment Thesis

CMS Energy offers the purest expression of utility economics: regulated monopoly, steady capex driving rate base growth, and compounding earnings at 6-7% annually. At $68/share (19x forward earnings), CMS trades at a premium to sector average (17x) but justifies it through clean energy leadership and execution consistency. For income investors, CMS provides 3% yield growing 6% annually—superior to bonds and inflation-protected. The total return proposition: 3% yield + 6-7% EPS growth = 9-10% annually if the multiple holds. Downside risk is limited by monopoly status, while upside comes from faster renewable deployment or ROE expansion. This is not a wealth-creation stock—it's a wealth-preservation vehicle that compounds steadily for decades.

Conclusion

CMS is BUY for income/defensive portfolios. Best entry on interest rate-driven pullbacks to $62-65. Appropriate for conservative investors, retirees, and ESG mandates. Not suitable for growth investors or yield-focused accounts requiring 4%+ dividends.
Bull Case
$78 (15% upside) - ROE expands to 10.5%, renewables deployed faster, Michigan economy strengthens
Base Case
$72 (6% upside) - Steady 7% rate base growth, 6% dividend increases continue
Bear Case
$60 (12% downside) - Regulators cut ROE to 9%, coal retirement costs spike

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