Report Date: Tuesday, July 28, 2026, before market open | Call at 10:00 a.m. ET
| Item | Detail |
|---|---|
| Current price (7/27/26) | ~$74.29 (down from a 2026 high near $79.94 in April; up ~5.5% YTD) |
| 2026 adjusted EPS guidance | $3.83–$3.90, reaffirmed with "continued confidence toward the high end" |
| Long-term EPS growth algorithm | 6–8% annually, biased to the high end |
| Q1 2026 adjusted EPS | $1.13 vs. $1.02 in Q1 2025 |
| Q2 2025 adjusted EPS (comp) | $0.71 |
| Street Q2 2026 EPS estimates | Roughly $0.55–$0.70 depending on data source (consensus centers near $0.63–$0.70) |
| Dividend | $0.57/share quarterly ($2.28 annualized), ~3% yield, 20th consecutive annual increase |
| Analyst sentiment | "Moderate Buy" consensus; recent price-target hikes from JPMorgan ($85), Barclays ($81) |
CMS enters this print as one of the steadiest stories in utilities — a company that has delivered consistent, in-guidance results for over two decades — but there are several live storylines (data centers, a gas rate case, a credit-rating headwind, and a large equity program) that investors will want updated color on.
CMS's Q1 2026 print was a clean beat-and-reaffirm quarter. The company reported adjusted earnings per share of $1.13 for the quarter, and reaffirmed guidance at $3.83 to $3.90 per share, with continued confidence toward the high end, and long-term guidance toward the high end of the 6% to 8% adjusted EPS growth range. The upside was driven largely by NorthStar outperforming a relatively soft comp in the first quarter of last year, coupled with higher rate relief net of investments at the utility, partially offset by a significant ice storm in our electric service territory in March.
Management's full-year bridge assumes normal weather going forward — a swing factor worth watching in Q2, since looking ahead, we plan for normal weather, as always, which equates to $0.23 per share of negative variance for the remaining 9 months of the year, driven by the absence of favorable temperatures experienced in 2025.
CMS's growth story increasingly hinges on large-load/data-center demand in Michigan. As of the Q1 call, management noted our announced data center continues to close in on final contract after reaching commercial terms on the extraordinary facilities agreement and now commercial terms on the rate contract, with another data center has continued to progress in advanced contract negotiations. Critically, CEO Garrick Rochow emphasized these projects are not yet in the 5-year capital plan, and each incremental gigawatt of new load represents capital opportunity of $2 billion to $5 billion incremental to current guidance.
The local zoning process (notably the Microsoft project in Gaines Township, Kent County) remains the pacing item. As of mid-2026, township officials had voted only to table the rezoning request rather than approve or deny it, with the process continuing through additional planning-commission review before any township board vote. Watch for an update on timing — management has held firm that the contracted 2028 in-service target is unchanged even amid the zoning delays.
CMS's "annual rate case" strategy remains central to the affordability/investment balance. On electric, the commission approved over 65% of our ask and maintained our 9.9% ROE in the electric business in the last order. On gas, in April, we saw the MPSC Staff position in our current gas rate case, recommending over 75% of our $240 million ask, with Staff also supported nearly 95% of our gas infrastructure investments. Management indicated the Proposal for Decision would land around August, with a final order expected September/October — meaning the Q2 call itself likely won't include the final outcome, but should offer updated color on the gas case and the newly filed 20-year Integrated Resource Plan (targeting 1.5 GW of new gas capacity and over 13 GW of renewables, filed in June per the company's plan).
A notable new risk flagged last quarter: Moody's did move the utility to a negative outlook, largely due to the size of our 5-year Capital Investment Plan relative to the timing of cost recovery, particularly for large projects with protracted construction cycles. CFO Rejji Hayes noted the company is evaluating a variety of countermeasures, but because the issue sits at the regulated OpCo rather than the parent, we're going to have to evaluate a variety of different solutions and likely have to educate the commission and other stakeholders on what we would have to do over the next 12 to 18 months to avoid Moody's taking further action. Investors should listen for any specifics on capital-structure or cost-of-capital remedies.
CMS has been proactively derisking its financing plan. In Q1, we executed equity forward contracts totaling approximately $495 million, significantly derisking our planned needs for the year, settling approximately $142 million of said equity contracts during the quarter, with a plan to issue an aggregate amount of approximately $700 million over the course of the year. Subsequently, in May the company launched a $3 billion at-the-market equity program to support this and future years' capital needs — consistent with management's guidance of ~$750 million/year of average equity issuance for 2027–2030, front-loaded toward the early years of the plan. Expect an update on ATM usage and whether strong stock performance is enabling further pre-funding of 2027–2028 needs.
Management continues to point to 2–3% annual sales growth underpinned by diverse (not just data-center) economic development — contracts for roughly 100 megawatts of new load signed last year, and we've exceeded that in just Q1 of this year, approximately 110 megawatts of signed contracts year-to-date, including the large Michigan Potash & Salt contract. CFO Hayes also stressed about 15% of that 9 gigawatt backlog is represented by non-data center opportunities, underscoring diversification. With Michigan in the middle of a gubernatorial election cycle, affordability messaging (Michigan ranks 14th lowest in the nation for electric bills) will likely remain a talking point.
CMS remains a lower-drama, high-visibility utility story: a constructive Michigan regulatory framework, a long capital runway (~$24 billion 5-year plan), and a call option on incremental data-center/large-load capital investment that is not yet embedded in guidance. The Q2 print itself is unlikely to be a major surprise — management has an unblemished multi-year record of hitting guidance — but the call commentary on (1) data-center contract/zoning progress, (2) the pending gas rate case and new IRP, (3) Moody's negative outlook remediation, and (4) equity issuance pacing will matter more for the stock than the quarterly EPS delta itself.