With a market cap of $18.90 billion, CenterPoint Energy Inc. (CNP) operates as a public utility holding company in the U.S. Headquartered in Houston, Texas, the company manages and maintains essential electric infrastructure, including wires and poles, for customers in the greater Houston area and southwestern Indiana. Additionally, CenterPoint Energy owns and operates electric generation capacity in Indiana. Its key subsidiaries include Houston Electric, CERC Corp., and Vectren.
CenterPoint Energy has significantly underperformed the broader market over the last year. The stock has gained 3.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 25.1%. In 2024, the stock has gained 2.7%, compared to SPX's 10.4% gains on a YTD basis.
Narrowing the focus, CNP’s underperformance is also evident when compared to the Utilities Select Sector SPDR Fund (XLU). The exchange-traded fund has gained about 9.6% over this period. Moreover, the ETF’s 11.8% gains on a YTD basis outweigh the stock’s returns over the same time frame.
On Apr. 30, CenterPoint Energy exceeded Wall Street's Q1 profit estimates. The results were supported by Minnesota gas business base rate hikes and favorable weather conditions. The stock declined marginally on the day it released earnings but gained the next three sessions.
For the current fiscal year, ending in December, analysts expect CNP’s EPS to grow 8% to $1.62 on a diluted basis. The company's earnings surprise history is mixed. It beat or matched the consensus estimate in three of the last four quarters while missing on another occasion.
Among the 14 analysts covering CNP stock, the consensus rating is a “Moderate Buy.” That’s based on six “Strong Buy” ratings, two “Moderate Buys,” five “Holds,” and one “Strong Sell.”
This configuration is slightly less bullish than three months ago, with seven suggesting a “Strong Buy.”
On May 2, BMO Capital analyst James Thalacker reiterated a “Buy” rating on CenterPoint Energy with a price target of $32.00. However, Analyst Ryan Levine from Citi (C) maintained a “Hold” rating on CenterPoint Energy with a price target of $34.00.
The mean price target of $30.69 represents a 3.9% premium to CNP’s current price levels. The Street-high price target of $34 suggests an upside potential of 15.1%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
