Updated 4/22/25
CMS Energy (CMS), based in Michigan, is a regulated utility delivering electricity and natural gas to millions of customers through its principal subsidiary, Consumers Energy. Over the past year, the stock has gained more than 20%, supported by consistent earnings, a growing dividend, and disciplined leadership.
The company recently reported full-year EPS of $3.33 and raised its annual dividend to $2.17, marking its 19th consecutive annual increase. CMS continues to invest heavily in grid modernization and clean energy initiatives while maintaining a stable financial outlook. With low share price volatility, a forward P/E of 20.04, and a 3.01% dividend yield, CMS offers a steady, income-focused opportunity backed by a clear long-term strategy and experienced executive team.
Recent Events
In the past year, CMS Energy’s stock price has seen a solid recovery, gaining around 20% and leaving the broader S&P 500’s modest rise in the dust. For a utility, that’s a notable move. It’s been helped by a stable interest rate environment and investor appetite for lower-volatility stocks.
At the same time, CMS has had to navigate some earnings headwinds. The most recent quarterly earnings showed a 14.2% decline in EPS compared to a year ago. That kind of softness isn’t unusual in the sector right now—interest expense is up, and the timing of regulatory rate decisions has created some bumps. Still, management seems confident about its long-term plans, backed by ongoing capital projects and a loyal customer base.
Something else worth noting: CMS stock doesn’t move much with the broader market. Its five-year beta is just 0.34, meaning it’s far less sensitive to daily market swings. For investors who like to sleep at night, that’s a comfort.
Key Dividend Metrics
💰 Forward Dividend Yield: 3.01%
🔁 5-Year Average Dividend Yield: 2.94%
📈 Trailing 12-Month Dividend Growth: 5.34%
🛡️ Payout Ratio: 61.86%
📅 Next Ex-Dividend Date: May 9, 2025
💵 Dividend Date: May 30, 2025
Dividend Overview
The current yield on CMS Energy sits just over 3%, a bit higher than its five-year average and nicely placed in that sweet spot many income investors are hunting for. It’s not a sky-high yield, but what makes it stand out is the consistency behind it.
CMS has a long history of paying dividends—and not just paying them, but steadily increasing them. The company has raised its dividend for 16 straight years. That kind of track record speaks to the dependability of its business model.
The payout ratio, at nearly 62%, is healthy for a utility. These types of companies can afford to distribute a larger portion of their earnings since their revenues are so steady and predictable. CMS seems to have found a good balance between paying shareholders and investing back into the business.
Cash flow remains strong, with operating cash flow hitting $2.37 billion over the past year. Levered free cash flow is in the red, which is common for utilities that are plowing cash into infrastructure. The dividend, though, still appears well-covered.
Debt is one of the few areas where CMS looks stretched. With total debt nearing $16.6 billion and a debt-to-equity ratio of nearly 190%, it’s definitely carrying a heavy load. That said, most of its debt is long-term and locked in at favorable rates, which helps reduce short-term risk. For now, it’s manageable—but something to keep an eye on.
Dividend Growth and Safety
CMS Energy has been growing its dividend with quiet confidence. The latest increase—from $2.06 to $2.17 per share—follows a steady pattern of annual hikes that now stretches back 16 years. Over the last five years, the average annual growth rate has hovered around 6%, which is quite healthy for a utility.
The company has stated that it aims to grow earnings per share in the 6% to 8% range over time, and it generally aligns its dividend increases with that growth. That kind of consistency helps dividend investors set expectations—and CMS has been meeting them.
One big reason for this reliability is its regulatory environment. CMS operates entirely in Michigan, which simplifies its dealings with regulators and reduces complexity. The state has generally supported the company’s rate requests and infrastructure investments. That local focus brings a kind of operational stability that national utilities don’t always enjoy.
Looking at coverage, the dividend remains well-supported by earnings. EPS over the last twelve months came in at $3.33, and the annual dividend is $2.17. That’s a coverage ratio of about 1.53x—comfortably above the danger zone, with room to absorb temporary earnings fluctuations if needed.
The low beta is another factor that adds to CMS’s appeal for dividend-focused investors. It doesn’t get caught up in broader market swings, and that calmness can act as a stabilizer in a well-rounded portfolio. When things get bumpy elsewhere, CMS just keeps doing what it does—powering homes and paying dividends.
Cash Flow Statement
CMS Energy’s cash flow picture over the trailing twelve months shows a business deep in a capital investment cycle. Operating cash flow came in at $2.37 billion, a healthy figure reflecting consistent performance from the utility’s core operations. However, capital expenditures of $3.18 billion more than offset those inflows, leading to a negative free cash flow of $808 million. This pattern has held steady in recent years, as CMS has prioritized upgrading its infrastructure and pushing forward with its clean energy initiatives.
On the financing side, CMS raised nearly $2 billion in new debt while repaying close to $1 billion, helping fund the shortfall from operations and investments. The company also issued $286 million in equity, likely as part of its ongoing capital plan. End-of-period cash fell slightly to $178 million, consistent with historical trends. While negative free cash flow can raise flags in some sectors, for a regulated utility like CMS, it’s often a reflection of long-term growth investments rather than operational weakness.
Analyst Ratings
📈 CMS Energy has seen a range of analyst actions recently, with sentiment showing a cautious but optimistic lean. Jefferies bumped up its price target from $77 to $83 while maintaining a Buy rating. The boost came as the firm highlighted CMS’s strong positioning in the face of shifting regulatory dynamics, including the Inflation Reduction Act and recent tariff structures. Jefferies also noted that the company’s resolution in a Michigan rate case helped reinforce the outlook.
🔻 Not every voice in the room has been as bullish. Guggenheim took a more reserved stance, downgrading CMS Energy from Buy to Neutral and setting a $69 price target. Their reasoning? The current stock price already seems to reflect its steady earnings and positive regulatory setting, leaving less room for upside in their view. Meanwhile, StockNews.com issued a Sell rating, pointing to near-term headwinds that could challenge earnings stability.
🌟 BMO Capital Markets offered a more upbeat take, raising its target from $73 to $80 and reaffirming its Outperform rating. They cited CMS’s long-term capital plan and regulated revenue base as key strengths. Barclays also joined the positive camp, upgrading the stock from Equal Weight to Overweight and moving the price target up from $68 to $75.
🎯 The consensus 12-month price target for CMS Energy now stands at roughly $75.73. Analysts’ estimates range from a low of $67 to a high of $83, painting a picture of measured optimism for the stock’s future direction.
Earning Report Summary
Steady Finish to 2024
CMS Energy wrapped up 2024 on a solid note, delivering earnings that showed consistent performance despite some financial pressures. Full-year earnings per share landed at $3.33, a step up from the $3.01 recorded the previous year. On an adjusted basis, that figure edged slightly higher to $3.34. The fourth quarter came in at $0.87 per share, a bit softer than the $1.05 posted in the same quarter of 2023. The drop wasn’t a huge surprise, as the company faced higher operating costs and interest expenses during the quarter.
Revenue for the year totaled $7.52 billion, showing a slight lift from $7.46 billion the year before. What really stood out was the company’s operating income, which climbed to $1.49 billion from $1.24 billion. That kind of improvement speaks to the team’s ability to manage costs effectively, even as they continued investing heavily in their infrastructure.
A Look Ahead
One of the bright spots in the report was the dividend. CMS raised its annual payout to $2.17 per share, continuing a long streak of annual increases that now stretches 19 years. For income-focused investors, that kind of reliability doesn’t go unnoticed.
Looking toward 2025, the company raised its adjusted earnings guidance to a range between $3.54 and $3.60 per share. That’s a slight bump from earlier expectations and suggests management feels confident about what’s coming. They’re still targeting long-term EPS growth in the 6 to 8 percent range, and they made it clear they believe they’re tracking toward the upper end of that goal.
CEO Garrick Rochow emphasized some key operational wins from the year, particularly when it came to grid investment and customer service. He pointed to a record level of capital put into the electric system, and a strong performance in outage response—more than 93% of affected customers had their power restored within 24 hours. Rochow said those efforts aren’t just about hitting numbers—they’re about building a better, more resilient energy future for Michigan.
That kind of focus, combining steady financials with big-picture execution, gives CMS a clear path forward. They’re balancing growth, reliability, and customer value—all while keeping the dividend growth story intact.
Chart Analysis
Price Trend and Moving Averages
Looking at the one-year chart for CMS, the stock has shown a fairly steady climb, with a few well-timed consolidations along the way. From the mid-$50s in early spring of last year, it climbed to a high just above $75 by March. That’s a respectable move for a utility name, which typically isn’t known for fast-paced price action. What stands out here is how cleanly the stock has respected the 50-day moving average for most of the year. It pulled back below the 50-day line briefly at the end of December but recovered quickly, continuing its trend higher.
The 200-day moving average also paints a constructive picture. It’s been rising consistently, reflecting longer-term strength. Even during periods where CMS moved sideways or dipped slightly, the 200-day line acted as a foundation. That consistent upward slope is a sign of underlying support in the name and suggests that buyers have been steadily stepping in during pullbacks.
Volume and Momentum
Volume has remained fairly stable throughout the year, with occasional spikes during earnings and brief pullbacks. There’s no evidence of aggressive selling pressure—if anything, volume patterns look supportive of accumulation. Those volume bursts during moves higher also help confirm that the uptrend wasn’t just drifting—it had real participation behind it.
The RSI at the bottom of the chart has stayed mostly in the neutral-to-bullish zone. It did briefly enter overbought territory in February, which lined up with a short-term top, but since then has cooled off without breaking into oversold levels. That’s typically a healthy sign—momentum pulled back, but not drastically. Right now, RSI is hovering around the mid-50s, which leaves room for another push higher if buyers regain interest.
Current Position
In the most recent few weeks, CMS pulled back slightly after touching highs above $75. Price has dipped below the 50-day moving average again, but it’s not a dramatic breakdown—more of a cooling period. The 200-day is still trending upward, and there’s no serious violation of long-term support. Unless that changes, the broader trend remains intact.
For those watching this chart from a longer perspective, the picture remains favorable. The stock has managed a slow, consistent climb with modest volatility, supported by steady volume and rising moving averages. The recent consolidation could simply be a breather after a strong run, with plenty of technical support not far below.
Management Team
At the helm of CMS Energy is Garrick J. Rochow, who has served as President and CEO since December 2020. With over two decades of experience within the company, Rochow has a deep understanding of its operations, having previously overseen electric and natural gas distribution, transmission, generation, and regulatory compliance. His leadership emphasizes operational excellence and a strong push toward sustainability.
Supporting Rochow is Rejji P. Hayes, the Executive Vice President and Chief Financial Officer since 2017. Hayes brings a strong financial background, keeping the company’s capital strategy aligned with long-term goals. Other key figures on the leadership team include Jim G. Beechey, Vice President of IT and Security and the company’s Chief Information Officer, who ensures cybersecurity and tech operations stay ahead of threats. Melissa M. Gleespen serves as Vice President, Corporate Secretary, and Chief Compliance Officer, maintaining legal integrity across the board. Scott McIntosh manages financial reporting and accounting as the Vice President, Controller, and Chief Accounting Officer. The digital side of operations is led by Aaron Rajda, who oversees data systems and analytics in his role as Chief Digital Officer.
Together, this team brings a combination of industry knowledge and progressive thinking, driving CMS Energy’s mission to deliver dependable and responsible energy.
Valuation and Stock Performance
As of late April 2025, CMS Energy is trading around $72.10, capping off a strong 12-month stretch that saw the stock rise by more than 21 percent. That upward move reflects investor optimism about the company’s stability and forward momentum. With a beta of 0.34, the stock doesn’t bounce around much relative to the broader market, which adds a layer of consistency for long-term investors.
From a valuation perspective, CMS trades at a trailing price-to-earnings ratio of 21.65 and a forward P/E of 20.04. Those numbers suggest the market expects steady earnings growth without overpaying dramatically. The price-to-book ratio sits at 2.69, indicating the stock is priced above its book value, which is typical for a well-performing utility with a solid earnings base.
What stands out for many shareholders is the dividend profile. CMS Energy currently pays an annual dividend of $2.17 per share, yielding about 3.01 percent. That income stream, backed by years of consistent increases, is part of what keeps the stock attractive to those looking for stability and cash returns. The company’s reliable payout record suggests a continued focus on delivering shareholder value through both performance and distribution.
Risks and Considerations
Like all companies in the utility space, CMS Energy comes with its own set of risks. Regulatory shifts at the state or federal level could change the playing field quickly. Since the company operates entirely within Michigan, its performance is closely tied to local economic and political dynamics. Any major changes in policy or public utility commission decisions could have a direct impact on margins and capital planning.
One concern often raised is the level of leverage. CMS holds over $16.5 billion in total debt, and its debt-to-equity ratio sits at about 189 percent. While this isn’t unusual for a capital-heavy utility business, it does mean the company needs to manage its interest exposure carefully—especially if interest rates remain elevated for an extended period.
There’s also growing pressure from environmental regulations and the broader energy transition. CMS is in the midst of shifting away from coal and increasing its investment in renewables, but these transitions aren’t cheap. They require upfront capital and come with long implementation timelines. On top of that, cybersecurity remains an ever-present issue. As grid systems become more digitally integrated, the threat of cyberattacks increases, requiring constant investment in protection and prevention.
Final Thoughts
CMS Energy continues to build on a legacy of consistency, both operationally and financially. The company has positioned itself as a reliable energy provider with an evolving business model geared toward a cleaner, smarter future. Backed by an experienced leadership team and a focused strategic plan, CMS is steadily navigating the challenges of modernization, climate policy, and customer expectations.
Despite risks like regulatory exposure and debt load, the company’s performance over the past year suggests it is handling these pressures well. Its dividend growth story remains intact, and its stock performance reflects steady confidence from the market. For those seeking a balance of growth, income, and lower volatility, CMS Energy offers a compelling profile shaped by long-term planning and disciplined execution.