NEE

What They Do

NextEra Energy (NEE) is one of America's largest electric utilities, serving 5.8 million customers across Florida through its Florida Power & Light subsidiary. The company also operates the world's largest generator of renewable energy from wind and solar through NextEra Energy Resources, developing clean energy projects nationwide and selling power under long-term contracts to utilities and corporations.

Investment Thesis

Key Risks

Growth Story

NEE targets 6-8% annual earnings growth through 2026, driven by Florida's population growth requiring utility infrastructure expansion and an aggressive renewable development pipeline. The company plans to invest $85-95 billion in capital projects through 2026, with roughly 60% allocated to renewable energy and grid modernization initiatives that benefit from federal tax incentives.

Profitability Profile

As a regulated utility with contracted renewable assets, NEE generates stable cash flows with predictable margins. The Florida utility business provides steady returns on invested capital (~10-11% ROE), while the renewable development arm benefits from long-term power purchase agreements that lock in returns for 15-25 years, supporting consistent free cash flow generation.

Competitive Position

NEE holds the #1 position in U.S. renewable development with significant scale advantages in project development, financing, and grid integration capabilities. Florida Power & Light consistently ranks among the most efficient utilities nationally, while NextEra Energy Resources' development pipeline and balance sheet strength create barriers for smaller renewable competitors.

Recent Momentum

Limited recent financial data is available, but NEE has historically demonstrated consistent execution on its growth strategy. The company continues benefiting from tailwinds including Florida's population growth, corporate renewable energy demand, and federal clean energy incentives under the Inflation Reduction Act.

What Wall Street Thinks

Wall Street generally views NEE as a premium utility with strong execution capabilities and favorable end markets. Analysts typically focus on the company's ability to maintain its dividend growth streak while funding aggressive capital investment plans, with debates centered on valuation relative to growth prospects in today's interest rate environment.

The Bottom Line

NEE offers investors a rare combination of utility stability and renewable energy growth exposure, backed by nearly three decades of consistent dividend increases and leadership positions in both regulated Florida markets and national clean energy development.