FTS vs CMS

For growth investors, CMS Energy Corporation (CMS) is the stronger pick with 13.

6% revenue growth year-over-year, versus 5. 8% for Fortis Inc. (FTS). CMS Energy Corporation (CMS) offers the better valuation at 21. 0x trailing P/E (19. 1x 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.

On trailing P/E, CMS Energy Corporation (CMS) is the cheapest at 21.

0x versus Fortis Inc. at 22. 4x. On forward P/E, Fortis Inc. is actually cheaper at 15. 2x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Fortis Inc. wins at 3. 02x versus CMS Energy Corporation's 3. 19x.

Over the past 5 years, Fortis Inc.

(FTS) delivered a total return of +43. 2%, compared to +30. 3% for CMS Energy Corporation (CMS). Over 10 years, the gap is even starker: FTS returned +125. 9% versus CMS's +121. 2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Fortis Inc.

(FTS) is the lower-risk stock at -0. 26β versus CMS Energy Corporation's 0. 01β — meaning CMS is approximately -103% more volatile than FTS relative to the S&P 500. On balance sheet safety, Fortis Inc. (FTS) carries a lower debt/equity ratio of 134% versus 195% for CMS Energy Corporation — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), CMS Energy Corporation (CMS) is pulling ahead at 13.

6% versus 5. 8% for Fortis Inc. (FTS). On earnings-per-share growth, the picture is similar: CMS Energy Corporation grew EPS 6. 0% year-over-year, compared to 4. 9% for Fortis Inc.. Over a 3-year CAGR, FTS leads at 3. 3% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

Fortis Inc.

(FTS) is the more profitable company, earning 14. 8% net margin versus 12. 5% for CMS Energy Corporation — meaning it keeps 14. 8% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: FTS leads at 28. 7% versus 20. 2% for CMS. At the gross margin level — before operating expenses — FTS leads at 72. 3%, 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.

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, Fortis Inc. (FTS) is the more undervalued stock at a PEG of 3. 02x versus CMS Energy Corporation's 3. 19x. Both stocks trade at elevated growth-adjusted valuations, so expected growth needs to materialise. On forward earnings alone, Fortis Inc. (FTS) trades at 15. 2x forward P/E versus 19. 1x for CMS Energy Corporation — 3. 9x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for FTS: 10. 5% to $62. 00.

All stocks in this comparison pay dividends.

CMS Energy Corporation (CMS) offers the highest yield at 3. 0%, versus 2. 0% for Fortis Inc. (FTS).

For long-horizon retirement investors, Fortis Inc.

(FTS) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β -0. 26), 2. 0% yield, +125. 9% 10Y return). Both have compounded well over 10 years (FTS: +125. 9%, CMS: +121. 2%), 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.

Both stocks operate in the Utilities sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

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.