Now trading at a price of $75.59, NextEra Energy has moved 1.7% so far today.
Over the last year, NextEra Energy logged a 3.9% change, with its stock price reaching a high of $91.35 and a low of $69.64. Over the same period, the stock underperformed the S&P 500 index by -13.0%. As of April 2023, the company's 50-day average price was $75.86. NextEra Energy, Inc., through its subsidiaries, generates, transmits, distributes, and sells electric power to retail and wholesale customers in North America. Based in Juno Beach, FL, the large-cap Technology company has 15,300 full time employees. NextEra Energy has returned a 2.3% dividend yield over the last 12 months, but this may not be sustainable seen that the company has a choppy cash flow record.
The Company May Be Profitable, but Its Balance Sheet Is Highly Leveraged:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $19,204 | $17,997 | $17,069 | $20,956 |
| Gross Margins | 58.3% | 59.5% | 50.3% | 48.4% |
| Operating Margins | 27.5% | 27.5% | 16.8% | 17.0% |
| Net Margins | 19.63% | 16.22% | 20.93% | 19.79% |
| Net Income (MM) | $3,769 | $2,919 | $3,573 | $4,147 |
| Net Interest Expense (MM) | -2,195 | -1,912 | -1,270 | -585 |
| Net Interest Expense (MM) | -$2,195 | -$1,912 | -$1,270 | -$585 |
| Depreciation & Amort. (MM) | -$4,478 | -$4,315 | -$4,212 | -$4,790 |
| Earnings Per Share | $1.93 | $1.48 | $1.81 | $3.37 |
| EPS Growth | n/a | -23.32% | 22.3% | 86.19% |
| Diluted Shares (MM) | 1,956 | 1,969 | 1,972 | 2,023 |
| Free Cash Flow (MM) | -$2,922 | $224 | -$277 | -$1,480 |
| Capital Expenditures (MM) | -$11,077 | -$7,759 | -$7,830 | -$9,742 |
| Net Current Assets (MM) | -$68,923 | -$75,373 | -$86,200 | -$96,009 |
| Current Ratio | 0.53 | 0.47 | 0.53 | 0.51 |
| Long Term Debt (MM) | $37,543 | $41,944 | $50,960 | $55,256 |
| Net Debt / EBITDA | 3.86 | 5.11 | 5.76 | 6.27 |
NextEra Energy has slimmer gross margins than its peers, negative and highly variable cash flows, and a highly leveraged balance sheet. On the other hand, the company benefits from average operating margins with a negative growth trend and a strong EPS growth trend. Furthermore, NextEra Energy has stable revenues and decreasing reinvestment in the business.
A Lower P/B Ratio Than Its Sector Average but Trades Above Its Graham Number:
NextEra Energy has a trailing twelve month P/E ratio of 22.5, compared to an average of 27.16 for the Technology sector. Based on its EPS guidance of $3.41, the company has a forward P/E ratio of 22.2. NextEra Energy's PEG ratio is 2.5 on the basis of the 9.0% weighted average of the company and the broader market's EPS compound average growth rates. This suggests that the company's shares are overvalued. In contrast, the market is likely undervaluing NextEra Energy in terms of its equity because its P/B ratio is 3.57 while the sector average is 6.23. The company's shares are currently trading 136.0% above their Graham number.
There's an Analyst Consensus of Some Upside Potential for NextEra Energy:
The 17 analysts following NextEra Energy have set target prices ranging from $80.0 to $108.0 per share, for an average of $92.58 with a buy rating. As of April 2023, the company is trading -18.1% away from its average target price, indicating that there is an analyst consensus of some upside potential.
NextEra Energy has a very low short interest because 0.0% of the company's shares are sold short. Institutions own 78.9% of the company's shares, and the insider ownership rate stands at 0.21%, suggesting a small amount of insider investors. The largest shareholder is the Vanguard Group, Inc., whose 10% stake in the company is worth $14,694,787,659.
