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Here's Why You Should Add CMS Energy (CMS) to Your Portfolio

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Earnings estimates for CMS Energy Corporation (CMS - Free Report) have been revised upward in the past 90 days. The Zacks Consensus Estimate for 2018 has inched up 0.4% to $2.34. Estimates for 2019 were unchanged at $2.51.

The stock has returned 3.5% in the past 12 months, against the industry’s decline of 5.9%.

 

Let’s focus on the factors that make CMS Energy a profitable bet.

Zacks Rank &Surprise History

The company currently carries a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The company has an average four-quarter positive earnings surprise of 8.67%.

VGM Score

The stock carries an impressive VGM Score of B.

 Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors. Backtested results indicate that stocks with a favorable VGM Score of A or B coupled with a bullish Zacks Rank offer the best investment bets.

Year-Over-Year Estimates & Long-Term Growth

CMS Energy’s year-over-year earnings growth for 2018 and 2019 are estimated at 7.83% and 7.20%, respectively. Sales growth for 2018 and 2019 is projected at 0.56% and 2.18%, respectively. The company’s long-term growth is projected at 6.20%.

Long-Term Plans

The company focuses on capacity maximization, reliability improvement, clean power generation and infrastructure upgrade. It plans to spend $10.1 billion from 2018 through 2022. CMS Energy also focuses on strengthening circuits and substations, replacing aging poles, installing smart meters as well as plans to invest around $6 billion for the same purpose.

Meanwhile, the companyhas undertaken initiatives to reduce carbon emissions from 2005 level. As of Jun 30, 2018, it has been able to successfully lower emissions by 35%. Going forward, the company aims to lower carbon emissions by 80% and retire all of its coal plants by 2040. CMS Energy projects by 2040 more than 40% of its energy will come from clean sources like wind and solar as well as from energy storage.

Other Stocks to Consider

A few other top-ranked stocks in the same industry are Ameren Corp. (AEE - Free Report) , FirstEnergy Corp. (FE - Free Report) and NextEra Energy, Inc (NEE - Free Report) . All these stocks carry a Zacks Rank #2.

Ameren delivered an average positive surprise of 9.76% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings moved up 6.9% in the past 90 days.

FirstEnergy delivered an average positive surprise of 4.74% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings moved up 2.9% in the past 90 days.

NextEra delivered an average positive surprise of 3.01% in the last four quarters. The Zacks Consensus Estimate for 2018 earnings inched up by a penny in the past 90 days.

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