NextEra Energy Inc (NEE) stock analysis

P/E below its 5-year median

NextEra Energy's P/E of 15.5 is below its own 5-year median of 25.9.

P/E below the industry

NextEra Energy's P/E of 15.5 is below the Electric Services median of 20.9.

EV/EBITDA above its 5-year median

NextEra Energy's EV/EBITDA of 19.7 is above its 5-year median of 18.7.

P/B above the industry

NextEra Energy's price-to-book of 2.93 is above the Electric Services median of 2.02.

Trading below fair value

The share price of $85.99 is below our fair value estimate of $93.16.

Margin of safety under 20%

The price is 7.7% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew 3.9% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 16.3% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 79.0% over the last twelve months, against a 5-year average of 18.5% a year.

Growing slower than the industry

Revenue grew 7.6% over the last twelve months; the Electric Services median is 7.8%.

Guidance raised

NextEra Energy raised its 2026 adjusted earnings per share outlook on Apr 23, 2026.

Gross margin trend

This company does not report gross profit.

Return on equity under 15%

Return on equity was 20.1% over the last twelve months and averaged 12.9% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 5.4%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

NextEra Energy's return on equity of 20.1% is above the Electric Services median of 8.3%.

Earnings grew over 5 years

Net income grew 18.5% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 43.1% over the last twelve months, against a 5-year average of 24.5%.

Net margin above the industry

NextEra Energy's net margin of 43.1% is above the Electric Services median of 8.8%.

High debt

Debt is 178% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 130% five years ago to 178%.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 13.5% of total debt; we look for at least 20%.

Interest coverage

Interest expense is not reported separately.

Short-term assets don't cover short-term debts

Current assets are 0.53 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.02; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

NextEra Energy paid dividends worth 2.8% of the share price over the last twelve months.

Yield below Treasuries

The 2.8% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; NextEra Energy yields 2.8%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 43.7% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.