CMS Energy (NYSE:CMS) - Share price, News & Analysis

CMS fundamental analysis
Snowflake Score
Valuation	0/6
Future Growth	1/6
Past Performance	2/6
Financial Health	2/6
Dividends	4/6

CMS Stock Overview

CMS Energy Corporation operates as an energy company primarily in Michigan.

Rewards

Earnings are forecast to grow 8.63% per year

Risk Analysis

Interest payments are not well covered by earnings

Dividend of 2.82% is not well covered by earnings

Significant insider selling over the past 3 months

CMS Energy Competitors

Price History & Performance

Summary of all time highs, changes and price drops for CMS Energy
Historical stock prices
Current Share Price	US$65.19
52 Week High	US$73.76
52 Week Low	US$58.51
Beta	0.26
1 Month Change	-7.58%
3 Month Change	-5.41%
1 Year Change	8.42%
3 Year Change	12.57%
5 Year Change	40.95%
Change since IPO	73.26%

Recent News & Updates

May 21

Why It's Time To Redeploy From CMS Energy

CMS Energy is a $20.0 billion holding company for a gas and electric utility serving Michigan. It also has a small operation (financially) as an unregulated power generator. The company’s dividend yields 2.7%. Its beta is low and attractive at 0.26. However, it is subject to rising cost inflation across the board, including in its debt costs. CMS has reconfigured its future electric generation capacity away from reliable coal, natural gas, and nuclear and toward intermittent renewables. Yet its grid operator is already warning of blackouts.

May 13

A Look At The Fair Value Of CMS Energy Corporation (NYSE:CMS)

Today we will run through one way of estimating the intrinsic value of CMS Energy Corporation ( NYSE:CMS ) by...

Shareholder Returns

	CMS	US Integrated Utilities	US Market
7D	6.6%	6.1%	6.6%
1Y	8.4%	7.3%	-18.5%

Return vs Industry: CMS exceeded the US Integrated Utilities industry which returned 6.1% over the past year.

Return vs Market: CMS exceeded the US Market which returned -20.5% over the past year.

Price Volatility

Is CMS's price volatile compared to industry and market?
CMS volatility
CMS Average Weekly Movement	3.3%
Integrated Utilities Industry Average Movement	3.2%
Market Average Movement	8.0%
10% most volatile stocks in US Market	16.6%
10% least volatile stocks in US Market	3.1%

Stable Share Price: CMS is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: CMS's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1987	8,507	Garrick Rochow	https://www.cmsenergy.com

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.

CMS Energy Fundamentals Summary

How do CMS Energy's earnings and revenue compare to its market cap?
CMS fundamental statistics
Market Cap	US$18.60b
Earnings (TTM)	US$778.00m
Revenue (TTM)	US$7.69b

24.3x

P/E Ratio

2.5x

P/S Ratio

Is CMS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
CMS income statement (TTM)
Revenue	US$7.69b
Cost of Revenue	US$5.00b
Gross Profit	US$2.69b
Other Expenses	US$1.91b
Earnings	US$778.00m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	2.68
Gross Margin	34.93%
Net Profit Margin	10.12%
Debt/Equity Ratio	167.8%

How did CMS perform over the long term?

See historical performance and comparison

Dividends

2.8%

Current Dividend Yield

66%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is CMS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for CMS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for CMS. This is calculated by dividing CMS's market cap by their current preferred multiple.
What is CMS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$18.60b

CMS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	4.1x
Enterprise Value/EBITDA	13.5x
PEG Ratio	2.8x

Price to Earnings Ratio vs Peers

How does CMS's PE Ratio compare to its peers?

CMS PE Ratio vs Peers

The above table shows the PE ratio for CMS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	23.4x

Forward PE

Price-To-Earnings vs Peers: CMS is expensive based on its Price-To-Earnings Ratio (24.3x) compared to the peer average (23.4x).

Price to Earnings Ratio vs Industry

How does CMS's PE Ratio compare vs other companies in the Global Integrated Utilities Industry?

Price-To-Earnings vs Industry: CMS is expensive based on its Price-To-Earnings Ratio (24.3x) compared to the US Integrated Utilities industry average (22x)

Price to Earnings Ratio vs Fair Ratio

What is CMS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

CMS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	24.3x
Fair PE Ratio	22.9x

Price-To-Earnings vs Fair Ratio: CMS is expensive based on its Price-To-Earnings Ratio (24.3x) compared to the estimated Fair Price-To-Earnings Ratio (22.9x).

Share Price vs Fair Value

What is the Fair Price of CMS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: CMS ($65.19) is trading above our estimate of fair value ($60.13)

Significantly Below Fair Value: CMS is trading above our estimate of fair value.

Price to Earnings Growth Ratio

PEG Ratio: CMS is poor value based on its PEG Ratio (2.8x)

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Future Growth

How is CMS Energy forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

8.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: CMS's forecast earnings growth (8.6% per year) is above the savings rate (1.9%).

Earnings vs Market: CMS's earnings (8.6% per year) are forecast to grow slower than the US market (13.9% per year).

High Growth Earnings: CMS's earnings are forecast to grow, but not significantly.

Revenue vs Market: CMS's revenue (3.5% per year) is forecast to grow slower than the US market (8.3% per year).

High Growth Revenue: CMS's revenue (3.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: CMS's Return on Equity is forecast to be low in 3 years time (13.3%).

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Past Performance

How has CMS Energy performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

9.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: CMS has high quality earnings.

Growing Profit Margin: CMS's current net profit margins (10.1%) are lower than last year (11.8%).

Past Earnings Growth Analysis

Earnings Trend: CMS's earnings have grown by 9.2% per year over the past 5 years.

Accelerating Growth: CMS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CMS had negative earnings growth (-0.6%) over the past year, making it difficult to compare to the Integrated Utilities industry average (6.6%).

Return on Equity

High ROE: CMS's Return on Equity (10.3%) is considered low.

Discover strong past performing companies

Financial Health

How is CMS Energy's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: CMS's short term assets ($2.5B) exceed its short term liabilities ($1.8B).

Long Term Liabilities: CMS's short term assets ($2.5B) do not cover its long term liabilities ($19.5B).

Debt to Equity History and Analysis

Debt Level: CMS's net debt to equity ratio (161.8%) is considered high.

Reducing Debt: CMS's debt to equity ratio has reduced from 225% to 167.8% over the past 5 years.

Debt Coverage: CMS's debt is not well covered by operating cash flow (13.6%).

Interest Coverage: CMS's interest payments on its debt are not well covered by EBIT (2.7x coverage).

Balance Sheet

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Dividend

What is CMS Energy current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

2.82%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: CMS's dividend (2.82%) is higher than the bottom 25% of dividend payers in the US market (1.62%).

High Dividend: CMS's dividend (2.82%) is low compared to the top 25% of dividend payers in the US market (4.34%).

Stability and Growth of Payments

Stable Dividend: CMS's dividends per share have been stable in the past 10 years.

Growing Dividend: CMS's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (65.6%), CMS's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: CMS is paying a dividend but the company has no free cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

5.0yrs

Average management tenure

CEO

Garrick Rochow (46 yo)

1.5yrs

Tenure

US$6,871,068

Compensation

Mr. Garrick J. Rochow has been Chief Executive Officer and President at CMS Energy Corp. and Consumers Energy Company since December 1, 2020. He serves as Director of CMS Energy Corp & Consumers Energy Com...

CEO Compensation Analysis

Compensation vs Market: Garrick's total compensation ($USD6.87M) is below average for companies of similar size in the US market ($USD13.59M).

Compensation vs Earnings: Garrick's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.

Leadership Team

Experienced Management: CMS's management team is seasoned and experienced (5 years average tenure).

Board Members

Experienced Board: CMS's board of directors are considered experienced (7.4 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: CMS insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/24 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31