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Why Is CMS Energy (CMS) Up 2.9% Since Last Earnings Report?

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A month has gone by since the last earnings report for CMS Energy (CMS). Shares have added about 2.9% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is CMS Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

CMS Energy Q1 Earnings Beat, Revenues Increase Y/Y

CMS Energy reported first-quarter 2022 adjusted earnings per share (EPS) of $1.20 from continuing operations, which beat the Zacks Consensus Estimate of $1.13 by 6.2%. The reported figure also improved 10.1% on a year-over-year basis.

The company reported GAAP earnings of $1.21, flat year over year.

Operational Performance

For the quarter under review, CMS Energy’s operating revenues were $2,374 million, which exceeded the Zacks Consensus Estimate of $2,128.9 million by 11.5%. The top line also improved 17.9% on a year-over-year basis.

CMS Energy’s interest charges were $124 million during the first quarter, which remained unchanged from the year-ago period.

Financial Condition

CMS Energy had cash and cash equivalents of $446 million as of Mar 31, 2022, down from $452 million at the end of 2021.

As of Mar 31, 2022, total debt, financial leases and financing obligations (excluding securitization debt) were $12,275 million compared with $12,276 million at the end of 2021.

During the first quarter of 2022, the company generated cash from operating activities worth $707 million compared with $832 million in first-quarter 2021.

2022 Guidance

CMS Energy reaffirmed its adjusted earnings guidance in the range of $2.85- $2.89 per share. The Zacks Consensus Estimate for the company’s 2022 earnings is currently pegged at $2.88, slightly above the mid-point of the company’s guided range.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

VGM Scores

At this time, CMS Energy has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, CMS Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

CMS Energy is part of the Zacks Utility - Electric Power industry. Over the past month, Alliant Energy (LNT), a stock from the same industry, has gained 6.7%. The company reported its results for the quarter ended March 2022 more than a month ago.

Alliant Energy reported revenues of $1.07 billion in the last reported quarter, representing a year-over-year change of +18.5%. EPS of $0.77 for the same period compares with $0.68 a year ago.


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