Comprehensive Stock Comparison
Compare CMS Energy Corporation (CMS) vs National Grid plc (NGG) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | CMS | 13.6% revenue growth vs NGG's -7.4% |
| Value | CMS | Lower P/E (20.2x vs 23.1x) |
| Quality / Margins | NGG | 12.7% net margin vs CMS's 12.6% |
| Stability / Safety | NGG | Beta 0.04 vs CMS's 0.09, lower leverage |
| Dividends | NGG | 2.2% yield; CMS pays no meaningful dividend |
| Momentum (1Y) | NGG | +55.9% vs CMS's +9.9% |
| Efficiency (ROA) | NGG | 4.5% ROA vs CMS's 2.8%, ROIC 4.6% vs 4.9% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
CMS Energy is a regulated utility holding company that provides electricity and natural gas services primarily to Michigan customers through its subsidiaries. It generates revenue from regulated electric and gas utility operations — which account for the vast majority of earnings — supplemented by independent power production and energy marketing through its Enterprises segment. The company's primary competitive advantage is its regulated monopoly status in its service territories, providing stable cash flows with returns approved by state regulators.
National Grid is a regulated utility that operates electricity and gas transmission and distribution networks in the UK and northeastern United States. It earns revenue through regulated asset returns — collecting fees from customers for using its infrastructure — with its UK transmission business contributing roughly 40% of operating profit and its US operations about 35%. The company's primary moat comes from its natural monopoly position as an owner of critical energy infrastructure, protected by high regulatory barriers to entry and long-term, stable rate-of-return frameworks.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
NGG leads in 3 of 6 categories (Financial Metrics, Profitability & Efficiency). CMS leads in 2 (Valuation Metrics, Analyst Outlook). 1 tied.
Financial Metrics (TTM)
NGG is the larger business by revenue, generating $36.8B annually — 4.4x CMS's $8.3B. Profitability is closely matched — net margins range from 12.7% (NGG) to 12.6% (CMS). On growth, CMS holds the edge at +15.9% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| RevenueTrailing 12 months | $8.3B | $36.8B |
| EBITDAEarnings before interest/tax | $3.0B | $12.5B |
| Net IncomeAfter-tax profit | $1.0B | $4.7B |
| Free Cash FlowCash after capex | -$1.5B | -$4.8B |
| Gross MarginGross profit ÷ Revenue | +38.9% | +100.0% |
| Operating MarginEBIT ÷ Revenue | +20.7% | +24.3% |
| Net MarginNet income ÷ Revenue | +12.6% | +12.7% |
| FCF MarginFCF ÷ Revenue | -18.2% | -13.1% |
| Rev. Growth (YoY)Latest quarter vs prior year | +15.9% | -11.3% |
| EPS Growth (YoY)Latest quarter vs prior year | +9.5% | -7.1% |
Valuation Metrics
At 22.1x trailing earnings, CMS trades at a 6% valuation discount to NGG's 23.6x P/E. Adjusting for growth (PEG ratio), NGG offers better value at 2.28x vs CMS's 3.70x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| Market CapShares × price | $6.6B | $93.2B |
| Enterprise ValueMkt cap + debt − cash | $24.8B | $155.6B |
| Trailing P/EPrice ÷ TTM EPS | 22.12x | 23.63x |
| Forward P/EPrice ÷ next-FY EPS est. | 20.16x | 23.15x |
| PEG RatioP/E ÷ EPS growth rate | 3.70x | 2.28x |
| EV / EBITDAEnterprise value multiple | 8.64x | 16.27x |
| Price / SalesMarket cap ÷ Revenue | 0.77x | 3.77x |
| Price / BookPrice ÷ Book value/share | 2.47x | 1.81x |
| Price / FCFMarket cap ÷ FCF | 2.94x | — |
Profitability & Efficiency
NGG delivers a 12.6% return on equity — every $100 of shareholder capital generates $13 in annual profit, vs $11 for CMS. NGG carries lower financial leverage with a 1.26x debt-to-equity ratio, signaling a more conservative balance sheet compared to CMS's 1.99x. On the Piotroski fundamental quality scale (0–9), NGG scores 7/9 vs CMS's 6/9, reflecting strong financial health.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| ROE (TTM)Return on equity | +11.1% | +12.6% |
| ROA (TTM)Return on assets | +2.8% | +4.5% |
| ROICReturn on invested capital | +4.9% | +4.6% |
| ROCEReturn on capital employed | +5.0% | +5.4% |
| Piotroski ScoreFundamental quality 0–9 | 6 | 7 |
| Debt / EquityFinancial leverage | 1.99x | 1.26x |
| Net DebtTotal debt minus cash | $18.3B | $46.4B |
| Cash & Equiv.Liquid assets | $615M | $1.2B |
| Total DebtShort + long-term debt | $18.9B | $47.5B |
| Interest CoverageEBIT ÷ Interest expense | 2.19x | 2.73x |
Total Returns (with DRIP)
A $10,000 investment in NGG five years ago would be worth $19,895 today (with dividends reinvested), compared to $16,046 for CMS. Over the past 12 months, NGG leads with a +55.9% total return vs CMS's +9.9%. The 3-year compound annual growth rate (CAGR) favors NGG at 19.5% vs CMS's 12.7% — a key indicator of consistent wealth creation.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| YTD ReturnYear-to-date | +11.7% | +19.1% |
| 1-Year ReturnPast 12 months | +9.9% | +55.9% |
| 3-Year ReturnCumulative with dividends | +43.0% | +70.6% |
| 5-Year ReturnCumulative with dividends | +60.5% | +98.9% |
| 10-Year ReturnCumulative with dividends | +140.8% | +84.4% |
| CAGR (3Y)Annualised 3-year return | +12.7% | +19.5% |
Risk & Volatility
NGG is the less volatile stock with a 0.04 beta — it tends to amplify market swings less than CMS's 0.09 beta. A beta below 1.0 means the stock typically moves less than the S&P 500.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 0.09x | 0.04x |
| 52-Week HighHighest price in past year | $78.31 | $94.64 |
| 52-Week LowLowest price in past year | $67.71 | $59.35 |
| % of 52W HighCurrent price vs 52-week peak | +99.7% | +99.1% |
| RSI (14)Momentum oscillator 0–100 | 69.8 | 75.2 |
| Avg Volume (50D)Average daily shares traded | 2.5M | 695K |
Analyst Outlook
Wall Street rates CMS as "Buy" and NGG as "Buy". Consensus price targets imply 2.0% upside for CMS (target: $80) vs -8.8% for NGG (target: $86). NGG is the only dividend payer here at 2.23% yield — a key consideration for income-focused portfolios.
| Metric | CMSCMS Energy Corpor… | NGGNational Grid plc |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $79.63 | $85.50 |
| # AnalystsCovering analysts | 29 | 20 |
| Dividend YieldAnnual dividend ÷ price | — | +2.2% |
| Dividend StreakConsecutive years of raises | 18 | 0 |
| Dividend / ShareAnnual DPS | — | $1.56 |
| Buyback YieldShare repurchases ÷ mkt cap | 0.0% | +0.0% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| CMS Energy Corporat… (CMS) | 100 | 109.99 | +10.0% |
| National Grid plc (NGG) | 100 | 130.71 | +30.7% |
National Grid plc (NGG) returned +99% over 5 years vs CMS Energy Corporat… (CMS)'s +60%. A $10,000 investment in NGG 5 years ago would be worth $19,895 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| CMS Energy Corporat… (CMS) | $6.4B | $8.5B | +33.4% |
| National Grid plc (NGG) | $13.2B | $18.4B | +39.1% |
CMS Energy Corporation's revenue grew from $6.4B (2016) to $8.5B (2025) — a 3.3% CAGR. National Grid plc's revenue grew from $13.2B (2016) to $18.4B (2025) — a 3.7% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| CMS Energy Corporat… (CMS) | 8.6% | 12.5% | +45.7% |
| National Grid plc (NGG) | 14.4% | 15.8% | +9.9% |
CMS Energy Corporation's net margin went from 9% (2016) to 13% (2025). National Grid plc's net margin went from 14% (2016) to 16% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| CMS Energy Corporat… (CMS) | 28.8 | 19.8 | -31.3% |
| National Grid plc (NGG) | 5.2 | 26.2 | +403.8% |
CMS Energy Corporation has traded in a 14x–29x P/E range over 9 years; current trailing P/E is ~22x. National Grid plc has traded in a 5x–33x P/E range over 9 years; current trailing P/E is ~24x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| CMS Energy Corporat… (CMS) | 1.98 | 3.53 | +78.3% |
| National Grid plc (NGG) | 3.75 | 2.95 | -21.3% |
CMS Energy Corporation's EPS grew from $1.98 (2016) to $3.53 (2025) — a 7% CAGR. National Grid plc's EPS grew from $3.75 (2016) to $2.95 (2025) — a -3% CAGR.
Chart 6Free Cash Flow — 5 Years
CMS Energy Corporation generated $2B FCF in 2025 (+970% vs 2021). National Grid plc generated $-2B FCF in 2025 (-211% vs 2021).
CMS vs NGG: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is CMS or NGG a better buy right now?
CMS Energy Corporation (CMS) offers the better valuation at 22.1x trailing P/E (20.2x forward), making it the more compelling value choice. Analysts rate CMS Energy Corporation (CMS) a "Buy" — based on 29 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — CMS or NGG?
On trailing P/E, CMS Energy Corporation (CMS) is the cheapest at 22.1x versus National Grid plc at 23.6x. On forward P/E, CMS Energy Corporation is actually cheaper at 20.2x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: National Grid plc wins at 2.23x versus CMS Energy Corporation's 3.37x.
03Which is the better long-term investment — CMS or NGG?
Over the past 5 years, National Grid plc (NGG) delivered a total return of +98.9%, compared to +60.5% for CMS Energy Corporation (CMS). A $10,000 investment in NGG five years ago would be worth approximately $20K today (assuming dividends reinvested). Over 10 years, the gap is even starker: CMS returned +140.8% versus NGG's +84.4%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — CMS or NGG?
By beta (market sensitivity over 5 years), National Grid plc (NGG) is the lower-risk stock at 0.04β versus CMS Energy Corporation's 0.09β — meaning CMS is approximately 99% more volatile than NGG relative to the S&P 500. On balance sheet safety, National Grid plc (NGG) carries a lower debt/equity ratio of 126% versus 199% for CMS Energy Corporation — giving it more financial flexibility in a downturn.
05Which has better profit margins — CMS or NGG?
National Grid plc (NGG) is the more profitable company, earning 15.8% net margin versus 12.5% for CMS Energy Corporation — meaning it keeps 15.8% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: NGG leads at 26.8% versus 20.2% for CMS. At the gross margin level — before operating expenses — NGG leads at 77.4%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is CMS or NGG more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, National Grid plc (NGG) is the more undervalued stock at a PEG of 2.23x versus CMS Energy Corporation's 3.37x. Both stocks trade at elevated growth-adjusted valuations, so expected growth needs to materialise. On forward earnings alone, CMS Energy Corporation (CMS) trades at 20.2x forward P/E versus 23.1x for National Grid plc — 3.0x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for CMS: 2.0% to $79.63.
07Which pays a better dividend — CMS or NGG?
In this comparison, NGG (2.2% yield) pays a dividend. CMS does not pay a meaningful dividend and should not be held primarily for income.
08Is CMS or NGG better for a retirement portfolio?
For long-horizon retirement investors, National Grid plc (NGG) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.04), 2.2% yield). Both have compounded well over 10 years (NGG: +84.4%, CMS: +140.8%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between CMS and NGG?
Both stocks operate in the Utilities sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. NGG pays a dividend while CMS does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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