Persistent capital intensity is evidenced by a CAPEX-to-OCF ratio that reached 196.5% in 2025Q4, necessitating frequent external capital raises such as the $643.4 million net stock issuance in 2025Q2.
| Cash from Operations | 596.42M | 584.49M | 508.16M | 551.17M | 567.28M | 547.87M | 485.7M | 503.16M |
| Operating CF Growth % | -30.87% | 15.02% | -7.8% | -2.84% | 3.54% | 12.8% | -3.47% | - |
| Operating CF / Revenue % | 27.26% | 26.99% | 25.78% | 28.42% | 25.22% | 30.78% | 31.89% | 34.52% |
| Net Income | 146.7M | 169.83M | 258.72M | 106.88M | 185.18M | 211.85M | 187.32M | 92.13M |
| Depreciation & Amortization | 407.83M | 483.38M | 423.01M | 353.69M | 341.12M | 320.21M | 314.67M | 301.07M |
| Deferred Taxes | 16.17M | 8.47M | 43.05M | -13.51M | 24.53M | 30.75M | 20.41M | -25.39M |
| Other Non-Cash Items | 99.43M | 7.65M | -36.04M | 38.5M | 67.77M | -23.42M | -28.26M | 114.42M |
| Working Capital Changes | -93.52M | -93.56M | -190.06M | 58.42M | -59.14M | -961K | -16.57M | 14.51M |
| Capital Expenditures | -1.17B | -1.2B | -1.25B | -1.08B | -912.56M | -935.02M | -679.03M | -616.27M |
| CapEx / Revenue % | 53.3% | 55.22% | 63.26% | 55.48% | 40.57% | 52.54% | 44.59% | 42.28% |
| CapEx / D&A | 2.86x | 2.47x | 2.95x | 3.04x | 2.68x | 2.92x | 2.16x | 2.05x |
| CapEx Coverage (OCF/CapEx) | 0.51x | 0.49x | 0.41x | 0.51x | 0.62x | 0.59x | 0.72x | 0.82x |
| Cash from Investing | -1.19B | -1.22B | -1.17B | -1.09B | -950.35M | -952.26M | -733.8M | -673.9M |
| Acquisitions | 0 | 0 | 104.39M | -26.25M | 0 | 0 | -23.25M | -38.25M |
| Purchase of Investments | -734.68M | -714.39M | -756.8M | -593.24M | -564.91M | -477.67M | -607.59M | -513.87M |
| Sale of Investments | 713.25M | 693.28M | 707.34M | 574.2M | 526.45M | 459.87M | 591M | 494.53M |
| Other Investing | -40K | -109K | 17.75M | 32.7M | 674K | 563K | -14.93M | -37K |
| Cash from Financing | 587.01M | 642.52M | 684.35M | 537.1M | 386.04M | 357.56M | 292.19M | 172.45M |
| Dividends Paid | -171.63M | -163.37M | -140.34M | -126.7M | -119.84M | -112.97M | -98.5M | -92.93M |
| Dividend Payout Ratio % | - | 107.94% | 57.83% | 143.42% | 70.47% | 57.53% | 56.84% | 119.3% |
| Debt Issuance (Net) | 0 | 1000K | 1000K | 1000K | 1000K | 1000K | 1000K | 1000K |
| Stock Issued | 946.43M | 842.74M | 98.6M | 198.18M | 0 | 0 | 283.23M | 943K |
| Share Repurchases | -11.05M | -11.97M | -8.46M | -9.65M | -7.98M | -10.13M | -11.98M | -9.92M |
| Other Financing | -14.13M | -100.06M | -26.32M | -2.72M | -33.94M | 44.96M | -17.45M | -12.55M |
| Net Change in Cash | 3.42M | 9.87M | 18.14M | -135K | 2.97M | -46.82M | 44.09M | 1.71M |
| Exchange Rate Effect | 7.48M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash at Beginning | 18.26M | 22.09M | 3.94M | 4.08M | 1.1M | 47.93M | 3.83M | 2.12M |
| Cash at End | 5.62M | 31.95M | 22.09M | 3.94M | 4.08M | 1.1M | 47.93M | 3.83M |
| Free Cash Flow | -569.59M | -611.43M | -738.88M | -524.64M | -345.27M | -387.14M | -193.33M | -113.11M |
| FCF Growth % | 23.44% | 17.25% | -40.84% | -51.95% | 10.82% | -100.25% | -70.92% | - |
| FCF Margin % | -26.04% | -28.23% | -37.48% | -27.05% | -15.35% | -21.75% | -12.69% | -7.76% |
| FCF / Net Income % | -388.26% | -403.95% | -304.46% | -593.85% | -203.03% | -197.16% | -111.55% | -145.22% |
Regulatory recovery lag risk
As reported in recent quarterly filings, TXNM consistently maintains a high capital intensity, with quarterly CAPEX frequently exceeding $300 million, which significantly outstrips operating cash flow and necessitates a reliance on external financing to sustain the company's grid modernization and renewable transition initiatives across its service territories.
The persistent gap between CAPEX and operating cash flow is a structural feature of the company's current growth phase rather than an operational failure. Investors should monitor whether the rate base growth generated by these investments will eventually provide sufficient regulatory recovery to stabilize the cash flow profile once the current heavy investment cycle begins to moderate.
Based on the provided financial data, TXNM has frequently turned to equity markets to bridge its free cash flow deficits, including a notable $643.4 million net stock issuance in 2025Q2, suggesting that the company's internal cash generation is currently insufficient to fund its ambitious infrastructure development program.
The reliance on equity issuance to fund operations may indicate that the company is managing its leverage ratios to maintain credit quality in the face of significant capital requirements. This strategy appears to prioritize balance sheet stability over immediate EPS accretion, though it warrants further investigation into the long-term dilution impact on existing shareholders.
According to historical cash flow statements, the company's OCF-to-dividend coverage ratio has fluctuated wildly, dropping to as low as 0.1x in 2025Q2, which highlights the vulnerability of dividend payments to the timing of regulatory rate case settlements and the resulting impact on quarterly operating cash flow.
While the dividend remains a priority, the extreme variability in coverage ratios suggests that the payout is not currently supported by consistent operational cash generation. Investors should interpret these fluctuations as a reflection of regulatory lag rather than a permanent inability to sustain the dividend, provided that rate recovery mechanisms eventually align with capital spending.
As indicated by the discrepancy between net income and operating cash flow in recent periods, TXNM's reported earnings are heavily influenced by non-cash items, which may obscure the underlying cash-generating capacity of the regulated utility business and complicate the assessment of true economic profitability for institutional investors.
The reliance on non-cash accounting credits, such as AFUDC, suggests that reported net income may overstate the immediate liquidity available to the company. This distortion makes it essential for analysts to focus on cash flow metrics rather than GAAP earnings to understand the actual financial health of the utility's regulated operations.
Quick answers to the most common questions about buying TXNM stock.
TXNM Energy, Inc. (TXNM) generated $584.5M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
TXNM Energy, Inc. (TXNM) reported negative free cash flow of $611.4M in 2025, indicating capital requirements exceeded cash from operations.
TXNM Energy, Inc. (TXNM) spent $1.20B on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, TXNM Energy, Inc. (TXNM) returned $163.4M to shareholders via cash dividends and spent $12.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.