Here's Why You Must Add CMS Energy Stock to Your Portfolio Now

CMS Energy Corporation CMS continues to invest consistently in infrastructure modernization to enhance service reliability for its customers. The company is also expanding its renewable generation portfolio. Considering its promising growth prospects, CMS offers a strong investment opportunity in the Zacks Utility Electric Power industry.

Let us focus on the reasons that make this Zacks Rank #2 (Buy) stock a solid investment pick at the moment.

CMS’ Growth Projections & Surprise History

The Zacks Consensus Estimate for CMS’ 2026 earnings per share (EPS) has increased 0.3% to $3.86 per share in the past 90 days.

The Zacks Consensus Estimate for CMS’ 2026 revenues stands at $8.76 billion, which indicates growth of 2.6%.

CMS’ long-term (three to five years) earnings growth rate is 7.31%. The company delivered an average earnings surprise of 3.08% in the last four quarters.

CMS’ Return on Equity

Return on equity (ROE) indicates how efficiently a company has been utilizing its funds to generate higher returns. Currently, CMS' ROE is 12.09% compared with its industry’s average of 10.82%. This indicates that the company has been utilizing its funds more constructively than its peers in the industry.

CMS’ Solvency

CMS Energy’s times interest earned ratio (TIE) at the end of the fourth quarter of 2025 was 2.6. The TIE ratio greater than one suggests that the company will be able to make its interest payment obligations in the near term without difficulty.

CMS’ Return to Shareholders

CMS Energy has been increasing shareholder value by steadily paying dividends. In February 2026, the company’s board of directors authorized a quarterly dividend increase to 57 cents per share from 54.25 cents, marking a 5.1% hike and bringing the annualized dividend to $2.28. CMS’ current dividend yield stands at 2.9%, significantly higher than the Zacks S&P 500 Composite’s 1.14%.

CMS’ Infrastructure Spending & Renewable Expansion

CMS Energy is making significant investments to modernize its infrastructure, replace aging assets and expand clean energy generation, with a focus on improving reliability and system resilience. To support these efforts, the company plans capital expenditures of nearly $24 billion over 2026-2030.

CMS is also accelerating the growth of its renewable energy portfolio. It aims to add about 8 gigawatts (GW) of solar and 2.8 GW of wind capacity over the next two decades. Under its renewable energy plan, Consumers Energy has acquired three wind projects since 2020, totaling 517 megawatts (MW) of nameplate capacity. Its updated renewable plan includes up to 9,000 megawatts MW of purchased power, along with as much as 4,000 MW of wind resources.

CMS Stock Price Performance

In the past three months, CMS shares have risen 12.3% compared with the industry’s growth of 11.4%.

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Other Stocks to Consider

A few other top-ranked stocks from the same industry are CenterPoint Energy Inc. CNP, NiSource Inc. NI and DTE Energy Company DTE, each holding a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CNP’s long-term earnings growth rate is 8.86%. The Zacks Consensus Estimate for its 2026 EPS stands at $1.91, which calls for a year-over-year jump of 8.5%.

NI’s long-term earnings growth rate is 5.97%. The Zacks Consensus Estimate for its 2026 EPS is pegged at $2.05, which implies a year-over-year rise of 7.9%.

DTE’s long-term earnings growth rate is 7.06%. The consensus estimate for its 2026 EPS is pegged at $7.72, which indicates a year-over-year rally of 4.9%.

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This article originally published on Zacks Investment Research (zacks.com).

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