Is CNP a high-quality business?

AlphaMadera's AlphaQuality grade scores CenterPoint Energy, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how CNP compares to a Buffett-style quality bar.

What is CenterPoint Energy, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to CNP based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes CNP a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

CNP - CenterPoint Energy, Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $44.00 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

D 33.0 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

C 52.1

5yr Avg ROIC 4.5% 32/100
Operating Margin Trend +1.87 pp/yr 98/100

Capital Efficiency

Weight: 15%

C- 50.8

5yr Avg ROE 9.9% 60/100
5yr Share-Count CAGR 1.8% 35/100

Growth Quality

Weight: 15%

D- 32.9

5yr Revenue CAGR 2.9% 44/100
5yr EPS CAGR -8.5% 3/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 15%

F 0.0

5yr FCF Margin -24.9% 0/100
5yr FCF/NI Conversion -1.95x 0/100

Balance Sheet

Weight: 20%

F 16.2

Net Debt / EBITDA 6.28x 5/100
Interest Coverage (EBIT/Int) 2.38x 35/100
Altman Z-Score 0.90 13/100

Stability

Weight: 15%

C- 45.9

EPS Volatility (σ/μ) 0.57 24/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 2/5 60/100

3 of 3 gurus held; 1 added; 2 trimmed; 1 full exit.

Holders: 3
Avg Δ position: -26.0%
New buys: 0
Full exits: 1

Dalio sold -100%
Wood decreased -76%
Cooperman decreased -29%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.