Jefferies cut CMS Energy’s target to $74 from $88 after CFO Rejji Hayes abruptly retired, raising uncertainty over data center contract growth and the future of its NorthStar unit. The firm cited CMS’s 6%–8% projected annual earnings growth and $24 billion capex plan through 2030 but questioned its premium valuation.
Jefferies downgraded CMS Energy from Buy to Hold and cut its price target to $74 from $88, citing uncertainty tied to the company's leadership transition and unclarified growth prospects in its unregulated segments.
Chief Financial Officer Rejji Hayes announced an immediate retirement after nearly nine years in the role, catching investors off guard and heightening doubts about strategic direction, particularly for the company's NorthStar division.
Despite these concerns, CMS Energy forecasts 6%–8% annual earnings growth and maintains a $24 billion capital investment plan through 2030, underpinned by a projected 10.5% annual increase in regulated utility asset value and stable rate-base expansion.
Analysts highlighted CMS Energy’s lag in securing large-scale data center contracts compared to peers such as DTE Energy, and flagged the NorthStar unit as an overhang, noting that an inefficient sale of its renewable assets could trigger an earnings reset.
