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1. Company Snapshot

1.a. Company Description

CenterPoint Energy, Inc.operates as a public utility holding company in the United States.The company operates through Electric and Natural Gas segments.


The Electric segment includes electric transmission and distribution services to electric customers and electric generation assets, as well as assets in the wholesale power market.The Natural Gas segment provides natural gas distribution services, as well as home appliance maintenance and repair services to customers in Minnesota; and home repair protection plans to natural gas customers in Arkansas, Indiana, Mississippi, Ohio, Oklahoma, and Texas and Louisiana through a third party.This segment also engages in the sale of regulated intrastate natural gas, and transportation and storage of natural gas for residential, commercial, industrial, and transportation customers.


As of December 31, 2021, it served approximately 2.7 million metered customers; owned 239 substation sites with a total installed rated transformer capacity of 71,241 megavolt amperes; operated approximately 1,00,000 linear miles of natural gas distribution and transmission mains; and owned and operated 285 miles of intrastate pipeline in Louisiana, Texas, and Oklahoma.The company was founded in 1866 and is headquartered in Houston, Texas.

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1.b. Last Insights on CNP

CenterPoint Energy's recent performance was driven by several positive factors. The company's Q4 earnings were in line with estimates, with revenues rising year-over-year. Additionally, CenterPoint Energy declared a regular quarterly cash dividend of $0.2200 per share, demonstrating its commitment to returning value to shareholders. The company's strong financial performance and dividend payout have made it an attractive option for investors. Furthermore, CenterPoint Energy's sale of its Louisiana and Mississippi natural gas distribution businesses to Bernhard Capital Partners has allowed the company to focus on its core operations and potentially unlock value for shareholders.

1.c. Company Highlights

2. CenterPoint Energy's Q3 2025 Earnings: Strong Growth and Execution

CenterPoint Energy reported non-GAAP EPS of $0.50 for the third quarter, representing a 60% increase over the same period last year, beating analyst estimates of $0.46. The company's financial performance was driven by growth and rate recovery, weather and usage, O&M, and other factors, resulting in a favorable variance of $0.07 compared to the same quarter last year. Revenue growth is expected to continue, with analysts estimating a 3.6% increase in revenues for next year.

Publication Date: Oct -27

📋 Highlights
  • 10-Year Financial Plan: $65B capital investment plan with $10B incremental opportunities, targeting 11%+ CAGR in rate base through 2030.
  • EPS Growth: Non-GAAP EPS of $0.50 for Q3 2025 (60% YoY increase), reaffirming 2025 guidance of $1.75–$1.77 and 2026 guidance of $1.90 (midpoint).
  • Ohio Gas LDC Transaction: $2.6B gross proceeds expected by Q4 2026, funding Texas growth projects with $500M deployed in 2025 and $1B accelerated in 2026.
  • Industrial Demand Surge: Texas industrial sales up 17% QoQ and 11% YoY, driven by data centers (0.5G connected) and Port of Houston exports (+18% QoQ).
  • Electric Load Growth: Houston Electric peak load to double to 42 GW by mid-2030s, with 10 GW increase by 2031 (49% growth from 2025 levels).

Financial Performance and Guidance

The company remains well-positioned to execute on its recently increased 2025 non-GAAP EPS guidance of $1.75 to $1.77 and reiterated its 2026 non-GAAP earnings guidance of at least the midpoint of $1.89 to $1.91 per share. CenterPoint Energy expects to grow non-GAAP EPS at the mid- to high end of its 7% to 9% range from 2026 through 2028 and 7% to 9% annually through 2035, as per the company's long-term financial plan.

Growth Drivers and Capital Investment

The company's Houston Electric service territory forecasts peak load demand to increase by 10 gigawatts in 2031, representing a nearly 50% increase in peak demand over the next 6 years. This growth is driven by strong demand from various sectors, including industrial customers, with industrial sales up over 17% quarter-over-quarter and 11% year-to-date. CenterPoint Energy's capital investment plan drives a projected rate base CAGR of over 11% through the end of the decade.

Valuation and Metrics

With a P/E Ratio of 24.92, P/B Ratio of 2.34, and ROE of 9.49%, the market is pricing in a certain level of growth and profitability for CenterPoint Energy. The company's EV/EBITDA ratio of 8.07 suggests a reasonable valuation relative to its earnings before interest, taxes, depreciation, and amortization. The dividend yield of 2.2% provides a relatively stable return for investors.

Strategic Developments and Outlook

The company announced the signing of its Ohio gas LDC transaction, expected to generate approximately $2.6 billion in gross proceeds, which will be redeployed into higher growth jurisdictions to efficiently fund its capital investment plan. As Christopher Foster stated, the asset sale is beneficial to the financing plan and earnings, with 25-30% less cash lag on a historical basis. CenterPoint Energy is well-positioned to execute the remainder of the year and beyond, with a strong growth profile and a focus on affordability.

3. NewsRoom

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Palantir Stock Rises -- Teams Up with Nvidia to Accelerate AI Infrastructure

Dec -04

Source: gurufocus.com

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Palantir Targets America's AI Energy 'Bottleneck' With Chain Reaction And Nvidia Partnership

Dec -04

Source: feeds.benzinga.com

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Palantir teams with Nvidia, CenterPoint Energy for software to speed up AI data center construction

Dec -04

Source: reuters.com

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CenterPoint Energy: A Particularly Well-Positioned Utility

Dec -03

Source: seekingalpha.com

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Ascendis Pharma Hit By FDA Delay As TransCon CNP Decision Slips To 2026

Nov -28

Source: benzinga.com

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Cetera Investment Advisers Has $3.82 Million Stock Position in CenterPoint Energy, Inc. $CNP

Nov -26

Source: defenseworld.net

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Ascendis Announces Extension of FDA Review Period for TransCon CNP (navepegritide) for Children with Achondroplasia

Nov -25

Source: globenewswire.com

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4 Low-Beta Defensive Stocks to Buy as Consumer Sentiment Plummets

Nov -25

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.66%)

6. Segments

Electric

Expected Growth: 2.5%

CenterPoint Energy's 2.5% growth in electric segment is driven by increasing demand from residential and commercial customers, investments in grid modernization, and favorable weather conditions. Additionally, the company's focus on renewable energy sources and energy efficiency programs contribute to the growth.

Natural Gas

Expected Growth: 2.8%

CenterPoint Energy's 2.8% growth in Natural Gas is driven by increasing demand from industrial and power generation customers, coupled with infrastructure investments in pipeline expansion and modernization. Additionally, favorable weather patterns and rising LNG exports contribute to the growth. Furthermore, the company's focus on cost savings and operational efficiencies also supports the growth momentum.

Energy Performance

Expected Growth: 3.2%

CenterPoint Energy's 3.2% growth in Energy Performance is driven by increasing adoption of energy-efficient solutions, favorable regulatory policies, and strategic investments in grid modernization. Additionally, rising demand for renewable energy sources and growing customer focus on sustainability contribute to the segment's growth.

7. Detailed Products

Electricity Transmission and Distribution

CenterPoint Energy provides electricity transmission and distribution services to residential, commercial, and industrial customers.

Natural Gas Distribution

CenterPoint Energy delivers natural gas to customers through its vast network of pipelines, providing a clean and efficient source of energy.

Energy Efficiency Programs

CenterPoint Energy offers energy efficiency programs to help customers reduce energy consumption and lower their energy bills.

Home Services

CenterPoint Energy provides home services, including HVAC maintenance, repair, and installation, as well as plumbing and electrical services.

Infrastructure Services

CenterPoint Energy offers infrastructure services, including pipeline construction, maintenance, and repair, to support the energy industry.

8. CenterPoint Energy, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

CenterPoint Energy, Inc. operates in a highly regulated industry, which limits the threat of substitutes. However, the increasing adoption of renewable energy sources and energy-efficient technologies poses a moderate threat to the company's traditional business model.

Bargaining Power Of Customers

CenterPoint Energy, Inc. serves a large customer base, which reduces the bargaining power of individual customers. Additionally, the company's diversified customer mix and long-term contracts further mitigate the bargaining power of customers.

Bargaining Power Of Suppliers

CenterPoint Energy, Inc. relies on a few large suppliers for its natural gas and electricity needs. While the company has diversified its supply chain, the bargaining power of suppliers remains moderate due to the concentrated nature of the industry.

Threat Of New Entrants

The energy industry is highly regulated, and significant barriers to entry exist, including high capital requirements and complex infrastructure needs. These barriers limit the threat of new entrants to CenterPoint Energy, Inc.'s business.

Intensity Of Rivalry

CenterPoint Energy, Inc. operates in a highly competitive industry, with several large players vying for market share. The company faces intense competition in terms of pricing, customer service, and innovation, which increases the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 65.82%
Debt Cost 4.46%
Equity Weight 34.18%
Equity Cost 8.50%
WACC 5.84%
Leverage 192.59%

11. Quality Control: CenterPoint Energy, Inc. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Pinnacle West Capital

A-Score: 6.4/10

Value: 5.9

Growth: 5.2

Quality: 4.1

Yield: 8.0

Momentum: 5.5

Volatility: 10.0

1-Year Total Return ->

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CenterPoint Energy

A-Score: 6.4/10

Value: 5.7

Growth: 3.4

Quality: 6.0

Yield: 5.0

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

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Ameren

A-Score: 6.4/10

Value: 5.3

Growth: 4.8

Quality: 4.5

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

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PPL

A-Score: 6.3/10

Value: 4.9

Growth: 4.2

Quality: 4.1

Yield: 7.0

Momentum: 7.5

Volatility: 10.0

1-Year Total Return ->

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Alliant Energy

A-Score: 6.1/10

Value: 4.8

Growth: 4.2

Quality: 4.9

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

1-Year Total Return ->

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CMS Energy

A-Score: 5.7/10

Value: 4.1

Growth: 4.1

Quality: 4.2

Yield: 6.0

Momentum: 6.0

Volatility: 10.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

38.43$

Current Price

38.43$

Potential

-0.00%

Expected Cash-Flows