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What's There in Store for CMS Energy (CMS) in Q4 Earnings?

Zacks Equity Research
·4-min read

CMS Energy Corporation CMS is slated to report fourth-quarter 2021 results on Feb 3 before the opening bell.

CMS Energy has a four-quarter earnings surprise of 7.67%, on average.

Factors to Note

During November and December, the company’s service territories witnessed cooler-than-normal temperatures accompanied by moderate-to-high snowfall in some parts. In October, the temperature remained more or less moderate. Hence, for the major part of the fourth quarter, cooler-than-normal temperatures prevailed, which is likely to have boosted electricity demand for warming purposes among the company’s customers. Furthermore, its service territories experienced significant precipitation levels in November, resulting in wet weather conditions.

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Such weather patterns are expected to have contributed favorably to the company’s revenues. However, the serious drought condition in certain parts of its service territories in November might have weighed on the soon-to-be-reported quarter’s top line.

Meanwhile, with the U.S. economy gradually recovering over the past couple of quarters, an improvement in industrial and commercial sales might have favorably contributed to the company’s revenues in the quarter to be reported.

However, an intense storm in October caused heavy rainfall in parts of Michigan, resulting in heavy floods, which might have disrupted the smooth electricity flow for CMS customers.

Thus, the overall impact of the aforementioned factors is likely to have been mixed on the company’s fourth-quarter performance.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $1.75 billion, suggesting a decline of 2.5% from the year-ago quarter.

From the cost perspective, the company has been successful in eliminating waste through its Consumers Energy Way, which might have resulted in cost savings in the to-be-reported quarter. This, in turn, is likely to have added impetus to the bottom line.

However, storm-related restoration costs might have had an adverse impact on overall quarterly earnings.

The Zacks Consensus Estimate for fourth-quarter earningsis pegged at 47 cents per share, indicating a decline of 16.1% from the prior-year reported figure.

CMS Energy Corporation Price and EPS Surprise

CMS Energy Corporation Price and EPS Surprise
CMS Energy Corporation Price and EPS Surprise

CMS Energy Corporation price-eps-surprise | CMS Energy Corporation Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for CMS Energy this time. The combination of a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that is not the case here.

The company has an Earnings ESP of 0.00% and carries a Zacks Rank #3. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Stocks to Consider

Here are three Utilities players you may want to consider as they have the right combination of elements to post an earnings beat this season:

Ameren Corporation AEE has an Earnings ESP of +1.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ameren has a four-quarter average earnings surprise of 6.65%. The Zacks Consensus Estimate for Ameren’s fourth-quarter sales and earnings is pegged at $1.39 billion and 50 cents per share, respectively. AEE boasts a long-term earnings growth rate of 7.5%.

Pacific Gas & Electric Co. PCG has an Earnings ESP of +1.82% and a Zacks Rank #2. Pacific Gas & Electrichas a four-quarter negative average earnings surprise of 5.48%.

The long-term earnings growth rate of PCG is pegged at 2.5%. The Zacks Consensus Estimate for Pacific Gas & Electric’s fourth-quarter sales and earnings is pegged at $5.12 billion and 28 cents per share, respectively.

American Electric Power Company, Inc. AEP has an Earnings ESP of +0.21% and a Zacks Rank #3.

American Electric boasts a long-term earnings growth rate of 5.7%. The Zacks Consensus Estimate for AEP’s fourth-quarter sales and earnings is pegged at $4.05 billion and 95 cents per share, respectively.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Ameren Corporation (AEE) : Free Stock Analysis Report

Pacific Gas & Electric Co. (PCG) : Free Stock Analysis Report

American Electric Power Company, Inc. (AEP) : Free Stock Analysis Report

CMS Energy Corporation (CMS) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research