CMS Energy (CMS, Financial) has announced its first-quarter financial results, surpassing revenue forecasts. The company reported a revenue of $2.45 billion for the quarter, which notably exceeds the consensus estimate of $2.3 billion.
Garrick Rochow, President and CEO of CMS Energy, expressed confidence in the company's trajectory towards meeting its 2025 operational and financial goals. Key factors contributing to this optimism include a favorable outcome in the electric rate case settled in March. This outcome is poised to support essential investments outlined in the company's electric Reliability Roadmap.
CMS Energy is also experiencing continuous progress in economic development and various customer investment initiatives within its electric and gas sectors. These developments align with the company's commitment to its triple bottom line strategy, emphasizing people, the planet, and prosperity.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 15 analysts, the average target price for CMS Energy Corp (CMS, Financial) is $74.91 with a high estimate of $83.00 and a low estimate of $60.64. The average target implies an upside of 1.92% from the current price of $73.50. More detailed estimate data can be found on the CMS Energy Corp (CMS) Forecast page.
Based on the consensus recommendation from 19 brokerage firms, CMS Energy Corp's (CMS, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for CMS Energy Corp (CMS, Financial) in one year is $62.20, suggesting a downside of 15.37% from the current price of $73.5. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the CMS Energy Corp (CMS) Summary page.
CMS Key Business Developments
Release Date: February 06, 2025
- Adjusted Earnings Per Share (EPS): $3.34, towards the high end of guidance range.
- 2025 EPS Guidance: Raised to $3.54 to $3.60, representing 6% to 8% growth.
- Adjusted Net Income: $998 million for 2024.
- Utility Customer Investment Plan: $20 billion over five years, up $3 billion from prior plan.
- Rate Base Growth: 8.5% through 2029.
- Capital Investment: $3.3 billion in 2024.
- Dividend Payout Ratio: Targeting about 60% over time.
- NorthStar Clean Energy EPS Contribution: $0.18 to $0.22 for 2025.
- 2025 Financing Plan: $1.3 billion of new holdco long-term debt and up to $500 million of equity.
- Load Growth: 2% to 3% annual growth expected in the outer years of the plan.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CMS Energy Corp (CMS, Financial) reported strong financial performance in 2024, with adjusted earnings per share of $3.34, towards the high end of their guidance range.
- The company has a five-year $20 billion utility customer investment plan, which is up $3 billion from the prior plan, supporting 8.5% rate base growth through 2029.
- CMS Energy Corp (CMS) is making significant progress in improving customer reliability, with 93% of customers having power restored within 24 hours in 2024, compared to 87% in 2023.
- The company has a robust renewable energy plan, aiming to achieve 60% renewables by 2035, with a diversified mix including 9 gigawatts of solar and 4 gigawatts of wind.
- CMS Energy Corp (CMS) is experiencing significant economic development in Michigan, with a projected 2% to 3% annual load growth driven by data centers and manufacturing.
Negative Points
- CMS Energy Corp (CMS) faced significant weather-related financial headwinds in 2024, with the warmest winter in the last 25 years impacting financial performance.
- The company anticipates a significant negative variance in 2025 due to the reversal of select countermeasures and expected capital costs associated with parent financings.
- CMS Energy Corp (CMS) is planning for a maintenance outage at the Dearborn Industrial Generation (DIG) facility, which will impact earnings in 2025.
- The regulatory environment in Michigan has been a concern, with some market participants worried about recent orders, although CMS Energy Corp (CMS) remains confident in constructive outcomes.
- CMS Energy Corp (CMS) has a significant reliance on external financing, with plans for approximately $1.3 billion of new holdco long-term debt and up to $500 million of equity issuance in 2025.
