MeritValue

CENTERPOINT ENERGY INC

CNPdata completeness 100%19 fiscal years on file
The thesis, from the filings

CENTERPOINT ENERGY INC earns about 2% on invested capital, but has diluted owners by 7% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $16.63 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$8.26B1$9.33B2$8.61B3$8.55B3$9.34B3
Net income$1.49B4$1.06B5$917M6$1.02B6$1.05B6
Operating cash flow$22M7$1.81B8$3.88B9$2.14B9$2.49B9
Capital expenditure$3.16B10$4.42B11$4.4B12$4.51B12$4.87B12
Free cash flow (derived)−$3.14B7−$2.61B8−$524M9−$2.37B9−$2.38B9
Total debt$31.7B13$32.2B14$36.2B15$41.9B16$44B16
Cash & equivalents$230M17$74M18$90M19$24M20$38M20
Diluted shares609.9M632.3M633.2M644.1M655.6M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$170.11
your share of equity
Profit it earned you last year
$16.05
Free cash flow it threw off
−$36.36
Debt you’d be carrying
$671.79

10 shares is a claim on $170.11 of net worth that earned you $16.05 and generated −$36.36 of cash last year, against $671.79 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
2% avg · 5y
FY21 2%FY22 3%FY23 2%FY24 2%FY25 2%

It earned an average 2% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+7% shares · 5y

Share count is up 7% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 39% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
DCF · Growth Exit 5Y
not applicable
3y-median FCF non-positive — growth-exit DCF not applicable (see EPV)
Earnings Power Value
$16.63
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$1.05B
  • growthAssumed0.0%
Graham Number
$24.75
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001130310-24-000010 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001130310-25-000040 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001130310-26-000008 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001130310-24-000010 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001130310-25-000040 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001130310-26-000008 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001130310-24-000010 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001130310-25-000040 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001130310-26-000008 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001130310-24-000010 (PaymentsToAcquireProductiveAssets)
  11. 10-K · period ending 2022-12-31 · accession 0001130310-25-000040 (PaymentsToAcquireProductiveAssets)
  12. 10-K · period ending 2023-12-31 · accession 0001130310-26-000008 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001130310-23-000013 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001130310-24-000010 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001130310-25-000040 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001130310-26-000008 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001130310-23-000013 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001130310-24-000010 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0001130310-25-000040 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001130310-26-000008 (CashAndCashEquivalentsAtCarryingValue)