BUY CMS @ $61.47

Buying CMS @ $61.47

2% position

CMS announced today that it's selling its banking subsidiary, Enerbank, for $960 million - or 16x 2021 earnings. It's not the most generous sales price - but it cleans up the story and makes earnings now nearly 100% regulated. Enerbank was ~$0.21 of the $2.84 guidance for the year (7%).

Earnings guidance has been reset lower to remove the segment's earnings - but growth could pick up from the new base. 

2022 guidance was introduced at $2.85-2.87 - which means the stock is trading at 21.5x 2022 earnings. Not cheap - but not bad for a premier regulated utility.

I'll pick up some shared on weakness today and HODL for a while.