Analyst Ross Fowler from Bank of America Securities maintained a Buy rating on CMS Energy and keeping the price target at $81.00.
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Ross Fowler has given his Buy rating due to a combination of factors surrounding CMS Energy’s recent regulatory outcomes. The Michigan Public Service Commission’s final order in the gas rate case authorized a substantial revenue increase, which, although not meeting the company’s full request, aligns with historical decisions and provides a solid foundation for future growth. The approved return on equity (ROE) was slightly reduced but remains competitive, reflecting a balanced approach by the commission.
Additionally, the staff’s recommendation in the electric rate case, while suggesting a lower ROE than CMS requested, still represents a significant portion of the company’s initial ask. This recommendation is seen as a favorable starting point, with expectations of improvements in the final order. Overall, the regulatory outcomes are viewed as reasonable and consistent with past practices, supporting the Buy rating as CMS Energy is well-positioned for continued stability and potential growth.
In another report released yesterday, Jefferies also maintained a Buy rating on the stock with a $82.00 price target.