NEXTERA ENERGY INC (NEE)
US65339F1012 - Common Stock
Taking everything into account, NEE scores 4 out of 10 in our fundamental rating. NEE was compared to 45 industry peers in the Electric Utilities industry. NEE scores excellent on profitability, but there are concerns on its financial health. NEE is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
NEE had positive earnings in the past year.
NEE had a positive operating cash flow in the past year.
NEE had positive earnings in each of the past 5 years.
NEE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NEE has a better Return On Assets (4.12%) than 82.22% of its industry peers.
NEE's Return On Equity of 15.40% is amongst the best of the industry. NEE outperforms 91.11% of its industry peers.
The Return On Invested Capital of NEE (5.44%) is better than 80.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NEE is in line with the industry average of 4.58%.
The last Return On Invested Capital (5.44%) for NEE is above the 3 year average (3.21%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.12% | ||
| ROE | 15.4% | ||
| ROIC | 5.44% |
ROA(3y)3.09%
ROA(5y)2.95%
ROE(3y)11.86%
ROE(5y)10.75%
ROIC(3y)3.21%
ROIC(5y)3.45%
1.3 Margins
The Profit Margin of NEE (26.00%) is better than 97.78% of its industry peers.
In the last couple of years the Profit Margin of NEE has declined.
The Operating Margin of NEE (34.97%) is better than 100.00% of its industry peers.
NEE's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.97% | ||
| PM (TTM) | 26% | ||
| GM | N/A |
OM growth 3Y9.74%
OM growth 5Y6.62%
PM growth 3Y17.04%
PM growth 5Y-8.11%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
NEE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for NEE has been increased compared to 1 year ago.
Compared to 5 years ago, NEE has more shares outstanding
NEE has a worse debt/assets ratio than last year.
2.2 Solvency
NEE has an Altman-Z score of 1.10. This is a bad value and indicates that NEE is not financially healthy and even has some risk of bankruptcy.
NEE has a Altman-Z score of 1.10. This is in the better half of the industry: NEE outperforms 68.89% of its industry peers.
NEE has a debt to FCF ratio of 41.76. This is a negative value and a sign of low solvency as NEE would need 41.76 years to pay back of all of its debts.
The Debt to FCF ratio of NEE (41.76) is better than 75.56% of its industry peers.
A Debt/Equity ratio of 1.40 is on the high side and indicates that NEE has dependencies on debt financing.
With a Debt to Equity ratio value of 1.40, NEE perfoms like the industry average, outperforming 42.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.4 | ||
| Debt/FCF | 41.76 | ||
| Altman-Z | 1.1 |
ROIC/WACC0.77
WACC7.1%
2.3 Liquidity
A Current Ratio of 0.55 indicates that NEE may have some problems paying its short term obligations.
NEE has a Current ratio of 0.55. This is amonst the worse of the industry: NEE underperforms 86.67% of its industry peers.
NEE has a Quick Ratio of 0.55. This is a bad value and indicates that NEE is not financially healthy enough and could expect problems in meeting its short term obligations.
NEE's Quick ratio of 0.47 is on the low side compared to the rest of the industry. NEE is outperformed by 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.47 |
3. Growth
3.1 Past
NEE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.28%, which is quite good.
The Earnings Per Share has been growing by 10.50% on average over the past years. This is quite good.
Looking at the last year, NEE shows a very strong growth in Revenue. The Revenue has grown by 34.16%.
The Revenue has been growing by 10.94% on average over the past years. This is quite good.
EPS 1Y (TTM)9.28%
EPS 3Y11.2%
EPS 5Y10.5%
EPS growth Q2Q1.96%
Revenue 1Y (TTM)34.16%
Revenue growth 3Y16.03%
Revenue growth 5Y10.94%
Revenue growth Q2Q11.58%
3.2 Future
The Earnings Per Share is expected to grow by 8.37% on average over the next years. This is quite good.
Based on estimates for the next years, NEE will show a small growth in Revenue. The Revenue will grow by 6.90% on average per year.
EPS Next Y8.01%
EPS Next 2Y8.07%
EPS Next 3Y7.76%
EPS Next 5Y8.37%
Revenue Next Year4.66%
Revenue Next 2Y6.29%
Revenue Next 3Y7.03%
Revenue Next 5Y6.9%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
NEE is valuated rather expensively with a Price/Earnings ratio of 20.32.
NEE's Price/Earnings ratio is a bit more expensive when compared to the industry. NEE is more expensive than 68.89% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.80. NEE is around the same levels.
Based on the Price/Forward Earnings ratio of 18.81, the valuation of NEE can be described as rather expensive.
Based on the Price/Forward Earnings ratio, NEE is valued a bit more expensive than the industry average as 77.78% of the companies are valued more cheaply.
NEE is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.27, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.32 | ||
| Fwd PE | 18.81 |
4.2 Price Multiples
71.11% of the companies in the same industry are cheaper than NEE, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, NEE is valued a bit cheaper than the industry average as 75.56% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 75.65 | ||
| EV/EBITDA | 12.33 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NEE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.54
PEG (5Y)1.93
EPS Next 2Y8.07%
EPS Next 3Y7.76%
5. Dividend
5.1 Amount
NEE has a Yearly Dividend Yield of 3.22%. Purely for dividend investing, there may be better candidates out there.
NEE's Dividend Yield is slightly below the industry average, which is at 5.35.
Compared to an average S&P500 Dividend Yield of 2.40, NEE pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.22% |
5.2 History
The dividend of NEE is nicely growing with an annual growth rate of 11.09%!
NEE has been paying a dividend for at least 10 years, so it has a reliable track record.
NEE has decreased its dividend recently.
Dividend Growth(5Y)11.09%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
NEE pays out 51.74% of its income as dividend. This is a bit on the high side, but may be sustainable.
NEE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP51.74%
EPS Next 2Y8.07%
EPS Next 3Y7.76%
NEXTERA ENERGY INC
NYSE:NEE (4/19/2024, 2:36:09 PM)
64.61
+0.6 (+0.94%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap132.61B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.22% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.32 | ||
| Fwd PE | 18.81 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.54
PEG (5Y)1.93
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.12% | ||
| ROE | 15.4% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 34.97% | ||
| PM (TTM) | 26% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.16
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.4 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.47 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)9.28%
EPS 3Y11.2%
EPS 5Y
EPS growth Q2Q
EPS Next Y8.01%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)34.16%
Revenue growth 3Y16.03%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y