CMS Energy (NYSE:CMS) has faced a significant downgrade from analysts at Wall Street Zen, shifting from a “hold” rating to a “sell” rating in a report released on October 28, 2023. This change reflects growing concerns among investors, as several other research firms have recently reassessed their positions on the stock.
In contrast, Wells Fargo & Company upgraded CMS Energy to a “hold” rating just days earlier, on October 24, 2023. KeyCorp also adjusted its price target, increasing it from $76.00 to $79.00 while maintaining an “overweight” rating in a research note dated October 15, 2023. Additionally, Weiss Ratings reiterated a “buy (B-)” rating on October 8, 2023, while JPMorgan Chase & Co. lowered its target price from $85.00 to $80.00 but kept an “overweight” stance. Barclays followed suit, raising its price target from $78.00 to $82.00 and also granting an “overweight” rating on October 21, 2023.
Overall, nine research analysts currently rate CMS Energy as a “buy,” while five have assigned a “hold” rating. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average price target of $78.50.
Recent Earnings Performance
CMS Energy reported its earnings results on October 30, 2023, revealing a quarterly earnings per share (EPS) of $0.93, surpassing analysts’ expectations of $0.86 by $0.07. The company generated $2.02 billion in revenue for the quarter, significantly exceeding the consensus estimate of $1.83 billion. CMS Energy also reported a net margin of 12.62% and a return on equity of 12.10%. This represents a 15.9% increase in revenue compared to the same quarter last year, when the firm earned $0.84 EPS.
Looking forward, CMS Energy has set its fiscal year 2025 guidance at $3.560 to $3.600 EPS, and for fiscal year 2026, the guidance is between $3.800 to $3.870 EPS. Analysts project that the company will report $3.59 EPS for the current fiscal year.
Insider Trading and Institutional Activity
In related news, CMS Energy’s Senior Vice President, Brandon J. Hofmeister, sold 4,000 shares of the company’s stock on November 3, 2023, at an average price of $72.47, totaling approximately $289,880. Following this transaction, Hofmeister retains 64,259 shares, valued at about $4,656,849.73. This sale reflects a 5.86% decrease in his ownership of the stock. Insider ownership currently stands at 0.49% of the total stock.
Institutional investors have also been active in CMS Energy. Norges Bank acquired a new stake in the company during the second quarter, valued at approximately $238,951,000. Price T. Rowe Associates Inc. MD increased its holdings by 16.1% in the first quarter, now owning 16,554,877 shares worth $1,243,438,000. Qube Research & Technologies Ltd saw a remarkable 1,048.7% growth in its position, acquiring 1,333,743 additional shares during the same period. Soroban Capital Partners LP and UBS Asset Management also significantly raised their stakes in CMS Energy.
Institutional investors collectively own 93.57% of CMS Energy’s stock, indicating strong confidence in the company’s long-term prospects.
CMS Energy, headquartered in Michigan, operates primarily as an energy provider through three main segments: Electric Utility, Gas Utility, and Enterprises. The Electric Utility segment involves various methods of electricity generation, including coal, wind, gas, renewable energy, oil, and nuclear sources.
As analysts continue to evaluate CMS Energy’s performance and outlook, investors will be closely monitoring future developments and earnings reports for further insights.
