MODEL VERDICT
CMS Energy Corporation (CMS) — Relative Valuation
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| Feb 28, 2026 | NEUTRAL | 0.23 | $78.07 | CURRENT | — |
| Feb 21, 2026 | NEUTRAL | 0.23 | $75.86 | CURRENT | — |
| Feb 14, 2026 | NEUTRAL | 0.26 | $76.74 | CURRENT | — |
| Feb 11, 2026 | NEUTRAL | 0.26 | $73.75 | CURRENT | — |
| Jan 11, 2026 | NEUTRAL | 0.26 | $69.99 | Below threshold | +4.0% |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Industry Median P/E 38 industry peers | $74.38 | -4.7% | 22% | A | Peer Data |
| EV/EBITDA 36 industry peers | $53.11 | -32.0% | 20% | A- | Peer Data |
| Forward P/E 38 analyst estimates | $69.40 | -11.1% | 12% | A- | Analyst Est. |
| Price / Free Cash Flow 18 industry peers | $23.92 | -69.4% | 8% | B+ | Peer Data |
| EV/EBIT 36 industry peers | $12.28 | -84.3% | 7% | B+ | Peer Data |
| Peg Ratio 21 industry peers | $40.57 | -48.0% | 5% | B | Data |
| EV To Revenue 37 industry peers | $34.37 | -56.0% | 4% | B | Data |
| Earnings Yield 38 industry peers | $74.38 | -4.7% | 4% | B | Data |
| Weighted Output Blended model output | $58.08 | -25.6% | 100% | 87 | OVERVALUED |
| EPS Growth ↓ | P/E Multiple → | 18× | 20× | 22× (Current) | 24× | 26× |
|---|---|---|---|---|---|
| Bear Case (2%) | $65 | $72 | $80 | $87 | $94 |
| Conservative (5%) | $67 | $74 | $82 | $89 | $96 |
| Base Case (6.0%) | $67 | $75 | $82 | $90 | $97 |
| Bull Case (8%) | $69 | $76 | $84 | $92 | $99 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 20.67 | 20.02 | 13.96 | 26.29 | 3.83 |
| EV/EBIT | 21.96 | 22.72 | 19.29 | 25.34 | 2.20 |
| EV/EBITDA | 13.69 | 13.66 | 13.14 | 14.74 | 0.52 |
| P/FFO | 9.13 | 9.36 | 7.63 | 10.70 | 1.01 |
| P/TBV | 2.57 | 2.42 | 2.08 | 3.53 | 0.50 |
| P/B Ratio | 2.57 | 2.42 | 2.08 | 3.53 | 0.50 |
| Div Yield | 0.03 | 0.03 | 0.02 | 0.03 | 0.00 |
| P/S Ratio | 2.50 | 2.57 | 2.14 | 2.72 | 0.22 |
Based on our peer multiples analysis with 20 valuation metrics, the model estimates CMS's fair value at $58.08 vs the current price of $78.07, implying -25.6% downside potential. Model verdict: Overvalued. Confidence: 87/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $58.08 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $51.67 (P10) to $75.35 (P90), with a median of $62.20.
CMS's current P/E of 22.1x compares to the industry median of 21.1x (38 peers in the group). This represents a +5.0% premium to the industry. The historical average P/E is 20.7x over 7 years. Signal: Fair Value.
29 analysts cover CMS with a consensus rating of Buy. The consensus price target is $79.63 (range: $77.00 — $82.00), implying +2.0% upside from the current price. Grade breakdown: Strong Buy (0), Buy (17), Hold (12), Sell (0), Strong Sell (0).
The model confidence score is 87/100, based on: data completeness (26), peer quality (25), historical depth (20), earnings stability (12), and model agreement (4). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Multiple compression: CMS trades at the 5530th percentile of its historical P/E range. A reversion to median (20.7×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that CMS's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +0.0σ, meaning margins are 0.0 standard deviations above their historical average. If margins revert to the 7-year mean (12.5%), the model estimates fair value drops by 750.0% to approximately $72. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.