Consumers Energy, Michigan's largest gas utility and a
CMS Energy Corp.
), has lowered its fuel costs by 44% over the past five years,
thereby saving $260 million for customers this winter compared to
five years ago. An average residential customer is expected to
save $50 due to lower heating costs this winter.
On the whole, the bill of an average residential customer is down
$200 this heating season compared to five years ago as a result
of this initiative taken by the company.
Consumers Energy delivers natural gas service to 1.7 million
customers in 45 counties in Michigan's Lower Peninsula. It aims
at saving additional money for customers by making their homes
more energy efficient.
The company is working to lower its costs as a part of its
Promise to Michigan program that aims at providing affordable and
reliable services to its customers. This is not the first time
that it has lowered its fuel costs. In Mar 2013, Consumers Energy
had declared to curtail its natural gas fuel costs by 15%. The
company indicated that these efforts to trim gas fuel costs will
assist Michigan families and businesses to save approximately
$200 million by 2014.
Albeit natural gas prices have trended down in recent times, the
cuts employed by CMS Energy are impressive by any standard. This
has only been possible as Consumers Energy is uniquely positioned
to take advantage of lower-priced natural gas due to its massive
Also, the company continues to invest in its natural gas
infrastructure to take advantage of lower-cost supplies,
benefiting customers now and in the future. Its projects include
expansion of gas compressor stations and replacement of natural
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CMS ENERGY (CMS): Free Stock Analysis Report
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CMS Energy plans to spend approximately $6.5 billion to $7.0
billion in the next five years (2013 - 2017) on upgrading its
distribution system and generation assets through projects such
as advanced metering infrastructure and renewable investments.
Consumers Energy intends to build a 700 MW new natural gas-fired
power plant in Genesee County.
With its robust pipeline of regulated investment opportunities
and favorable regulatory treatment, the company remains on track
to achieve its long-term EPS growth target of 5% to 7% and annual
rate base growth of 6% to 7%.
However, in the near term, lackluster electricity sales growth is
hampering the earnings prospects of the company. Lower demand due
to a tepid economy has significantly affected retail sales, as
well as industrial sales volume. Also, pending regulatory cases
are a concern.
The Zacks Consensus Estimate for the third quarter 2013 is 55
cents, down a projected 2.68% year over year.
CMS Energy presently has a short-term Zacks Rank #4 (Sell).
Stocks that are worth considering in the space are
Alliant Energy Corp.
Brookfield Infrastructure Partners L.P.
), all with a Zacks Rank #2 (Buy).