CMS Energy exceeds expectations, raises 2026 guidance on NorthStar strength
Utility raises dividend for 20th consecutive year as clean energy segment drives strong 2025 performance
CMS Energy Corporation delivered stronger-than-expected financial results for 2025, exceeding its own earnings guidance and raising its outlook for 2026 as the Michigan-based utility continues to benefit from its clean energy transition. The company also rewarded shareholders with its 20th consecutive annual dividend increase.
The parent company of Consumers Energy reported adjusted earnings per share of $3.61 for 2025, up from $3.34 in the previous year and exceeding the company's guidance range. The outperformance was driven primarily by strong results at NorthStar Clean Energy, CMS's subsidiary focused on renewable generation and energy storage solutions.
In the fourth quarter, CMS reported adjusted EPS of $0.95, surpassing analyst estimates. Quarterly revenue increased by $244 million compared to the same period in 2024, reflecting higher demand and improved operational performance across the company's utility and non-regulated segments.
"Our team delivered strong operational and financial results in 2025, exceeding our adjusted EPS guidance for the 22nd consecutive year," the company stated in its earnings announcement. "We are building a cleaner, more reliable energy future for Michigan while creating value for our customers and shareholders."
Building on the momentum, CMS raised its 2026 adjusted EPS guidance to a range of $3.83 to $3.90 per share, up from previous guidance of $3.80 to $3.87. The company also reaffirmed its long-term adjusted EPS growth target of 6 to 8 percent, expressing confidence toward the higher end of that range.
The board of directors approved an 11-cent increase in the annual dividend, bringing it to $2.28 per share for 2026. This marks the 20th consecutive year of dividend increases, demonstrating the utility's commitment to returning capital to shareholders while investing in infrastructure upgrades and renewable energy projects.
Full-year operating revenue for 2025 reached $8.54 billion, up from $7.52 billion in the prior year. The company reported net income of $1.06 billion available to common stockholders, compared to $993 million in 2024. Total assets grew to $39.94 billion, reflecting significant capital investments in grid modernization and clean energy infrastructure.
CMS's shares currently trade at approximately $71.60, giving the company a market capitalization of $21.8 billion. The stock carries an analyst price target of $77.46, suggesting potential upside of roughly 8%. The utility's dividend yield stands at 3.2%, attractive to income-focused investors in the current rate environment.
The strong performance comes as CMS continues its transition toward cleaner energy sources. NorthStar Clean Energy has been expanding its portfolio of renewable generation, including wind and solar projects, as well as energy storage capabilities that support grid reliability. The company serves approximately 6.7 million customers across Michigan through its Consumers Energy subsidiary.
Looking ahead, CMS faces both opportunities and challenges. The company's regulated utility business provides stable cash flows, while its clean energy initiatives offer growth potential in emerging markets. However, the capital-intensive nature of utility operations and ongoing investment requirements could pressure financial flexibility if not managed carefully.
Investors will be watching execution on the company's clean energy strategy and its ability to maintain steady earnings growth while navigating regulatory processes. With Michigan pursuing ambitious clean energy goals, CMS appears well-positioned to benefit from the transition while continuing its dividend growth streak.