NEXTERA ENERGY INC (NEE) Stock Fundamental Analysis
NYSE:NEE - New York Stock Exchange, Inc. - US65339F1012 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to NEE. NEE was compared to 47 industry peers in the Electric Utilities industry. There are concerns on the financial health of NEE while its profitability can be described as average. NEE is quite expensive at the moment. 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.
Each year in the past 5 years NEE has been profitable.
NEE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NEE has a Return On Assets of 2.84%. This is comparable to the rest of the industry: NEE outperforms 46.81% of its industry peers.
The Return On Equity of NEE (11.06%) is better than 65.96% of its industry peers.
NEE has a Return On Invested Capital of 3.84%. This is in the lower half of the industry: NEE underperforms 63.83% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NEE is significantly below the industry average of 38.54%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.84% | ||
| ROE | 11.06% | ||
| ROIC | 3.84% |
ROA(3y)3.46%
ROA(5y)3.04%
ROE(3y)13.28%
ROE(5y)11.49%
ROIC(3y)3.99%
ROIC(5y)3.56%
1.3 Margins
NEE has a Profit Margin of 21.81%. This is amongst the best in the industry. NEE outperforms 91.49% of its industry peers.
In the last couple of years the Profit Margin of NEE has grown nicely.
NEE's Operating Margin of 29.26% is amongst the best of the industry. NEE outperforms 93.62% of its industry peers.
NEE's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.26% | ||
| PM (TTM) | 21.81% | ||
| GM | N/A |
OM growth 3Y19.72%
OM growth 5Y1.81%
PM growth 3Y10.26%
PM growth 5Y7.41%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NEE 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
The debt/assets ratio for NEE is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.02, we must say that NEE is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.02, NEE is in the better half of the industry, outperforming 63.83% of the companies in the same industry.
The Debt to FCF ratio of NEE is 20.36, which is on the high side as it means it would take NEE, 20.36 years of fcf income to pay off all of its debts.
NEE has a Debt to FCF ratio of 20.36. This is in the better half of the industry: NEE outperforms 76.60% of its industry peers.
NEE has a Debt/Equity ratio of 1.65. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of NEE (1.65) is worse than 63.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 20.36 | ||
| Altman-Z | 1.02 |
ROIC/WACC0.44
WACC8.69%
2.3 Liquidity
A Current Ratio of 0.55 indicates that NEE may have some problems paying its short term obligations.
The Current ratio of NEE (0.55) is worse than 82.98% of its industry peers.
A Quick Ratio of 0.45 indicates that NEE may have some problems paying its short term obligations.
The Quick ratio of NEE (0.45) is worse than 80.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
NEE shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 8.00%.
The Earnings Per Share has been growing by 10.36% on average over the past years. This is quite good.
The Revenue has decreased by -6.86% in the past year.
The Revenue has been growing slightly by 5.21% on average over the past years.
EPS 1Y (TTM)8%
EPS 3Y10.53%
EPS 5Y10.36%
EPS Q2Q%8.79%
Revenue 1Y (TTM)-6.86%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%9%
3.2 Future
Based on estimates for the next years, NEE will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.33% on average per year.
Based on estimates for the next years, NEE will show a small growth in Revenue. The Revenue will grow by 7.28% on average per year.
EPS Next Y7.9%
EPS Next 2Y8.23%
EPS Next 3Y8.55%
EPS Next 5Y8.33%
Revenue Next Year4.17%
Revenue Next 2Y6.71%
Revenue Next 3Y7.44%
Revenue Next 5Y7.28%
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 stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 19.80, NEE is valued on the expensive side.
Based on the Price/Earnings ratio, NEE is valued a bit more expensive than 68.09% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.15, NEE is valued a bit cheaper.
NEE is valuated rather expensively with a Price/Forward Earnings ratio of 17.30.
NEE's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.60, NEE is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.8 | ||
| Fwd PE | 17.3 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NEE is valued expensively inside the industry as 85.11% of the companies are valued cheaper.
Based on the Price/Free Cash Flow ratio, NEE is valued a bit cheaper than 78.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.49 | ||
| EV/EBITDA | 17.08 |
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)2.51
PEG (5Y)1.91
EPS Next 2Y8.23%
EPS Next 3Y8.55%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.19%, NEE has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.67, NEE is paying slightly less dividend.
NEE's Dividend Yield is a higher than the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.19% |
5.2 History
On average, the dividend of NEE grows each year by 10.61%, which is quite nice.
NEE has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of NEE decreased in the last 3 years.
Dividend Growth(5Y)10.61%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
78.82% of the earnings are spent on dividend by NEE. This is not a sustainable payout ratio.
The dividend of NEE is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP78.82%
EPS Next 2Y8.23%
EPS Next 3Y8.55%
NYSE:NEE (7/1/2025, 9:43:05 AM)
69.515
+0.09 (+0.14%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners83.13%
Inst Owner Change1.44%
Ins Owners0.06%
Ins Owner Change6.76%
Market Cap143.11B
Analysts77.04
Price Target82.73 (19.01%)
Short Float %1.7%
Short Ratio2.68
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.19% |
Yearly Dividend2.06
Dividend Growth(5Y)10.61%
DP78.82%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.51%
Min EPS beat(2)-0.12%
Max EPS beat(2)1.14%
EPS beat(4)2
Avg EPS beat(4)0.43%
Min EPS beat(4)-2.94%
Max EPS beat(4)3.63%
EPS beat(8)6
Avg EPS beat(8)4.46%
EPS beat(12)10
Avg EPS beat(12)5.71%
EPS beat(16)14
Avg EPS beat(16)4.92%
Revenue beat(2)0
Avg Revenue beat(2)-16.64%
Min Revenue beat(2)-24.58%
Max Revenue beat(2)-8.71%
Revenue beat(4)0
Avg Revenue beat(4)-14.81%
Min Revenue beat(4)-24.58%
Max Revenue beat(4)-7.56%
Revenue beat(8)3
Avg Revenue beat(8)-3.81%
Revenue beat(12)5
Avg Revenue beat(12)-0.14%
Revenue beat(16)5
Avg Revenue beat(16)-6.8%
PT rev (1m)-1.59%
PT rev (3m)-4.08%
EPS NQ rev (1m)-2.58%
EPS NQ rev (3m)-6.41%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-0.42%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.35%
Revenue NY rev (1m)1.06%
Revenue NY rev (3m)-3.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.8 | ||
| Fwd PE | 17.3 | ||
| P/S | 5.66 | ||
| P/FCF | 32.49 | ||
| P/OCF | 11.05 | ||
| P/B | 2.87 | ||
| P/tB | 3.18 | ||
| EV/EBITDA | 17.08 |
EPS(TTM)3.51
EY5.05%
EPS(NY)4.02
Fwd EY5.78%
FCF(TTM)2.14
FCFY3.08%
OCF(TTM)6.29
OCFY9.05%
SpS12.27
BVpS24.2
TBVpS21.83
PEG (NY)2.51
PEG (5Y)1.91
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.84% | ||
| ROE | 11.06% | ||
| ROCE | 4.31% | ||
| ROIC | 3.84% | ||
| ROICexc | 3.9% | ||
| ROICexgc | 4.01% | ||
| OM | 29.26% | ||
| PM (TTM) | 21.81% | ||
| GM | N/A | ||
| FCFM | 17.43% |
ROA(3y)3.46%
ROA(5y)3.04%
ROE(3y)13.28%
ROE(5y)11.49%
ROIC(3y)3.99%
ROIC(5y)3.56%
ROICexc(3y)4.05%
ROICexc(5y)3.6%
ROICexgc(3y)4.27%
ROICexgc(5y)3.79%
ROCE(3y)4.53%
ROCE(5y)4.03%
ROICexcg growth 3Y23.72%
ROICexcg growth 5Y-1.72%
ROICexc growth 3Y23.46%
ROICexc growth 5Y-1.95%
OM growth 3Y19.72%
OM growth 5Y1.81%
PM growth 3Y10.26%
PM growth 5Y7.41%
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 20.36 | ||
| Debt/EBITDA | 6.15 | ||
| Cap/Depr | 143.67% | ||
| Cap/Sales | 33.83% | ||
| Interest Coverage | 2.59 | ||
| Cash Conversion | 97.08% | ||
| Profit Quality | 79.95% | ||
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.45 | ||
| Altman-Z | 1.02 |
F-Score4
WACC8.69%
ROIC/WACC0.44
Cap/Depr(3y)168.8%
Cap/Depr(5y)166%
Cap/Sales(3y)38.28%
Cap/Sales(5y)38.73%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)8%
EPS 3Y10.53%
EPS 5Y10.36%
EPS Q2Q%8.79%
EPS Next Y7.9%
EPS Next 2Y8.23%
EPS Next 3Y8.55%
EPS Next 5Y8.33%
Revenue 1Y (TTM)-6.86%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%9%
Revenue Next Year4.17%
Revenue Next 2Y6.71%
Revenue Next 3Y7.44%
Revenue Next 5Y7.28%
EBIT growth 1Y-16.4%
EBIT growth 3Y35.51%
EBIT growth 5Y7.12%
EBIT Next Year71.24%
EBIT Next 3Y29.96%
EBIT Next 5Y20.93%
FCF growth 1Y349.86%
FCF growth 3Y111.03%
FCF growth 5Y16.17%
OCF growth 1Y62.45%
OCF growth 3Y20.64%
OCF growth 5Y10.21%