Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside* |
|---|---|---|---|---|---|---|---|
| 30 Jan, 25 | NEE | Buy | USD 70.89 | USD 76.0 | USD 82.0 | 38 days | 15.7% |
*Potential Upside (%) indicates the expected percentage increase from the Entry Price to the Target 2 Price.
Data Powered by EOD Historical Data (“EODHD”).
NextEra Energy, Inc., through its subsidiaries, generates, transmits, distributes, and sells electric power to retail and wholesale customers in North America. The company generates electricity through wind, solar, nuclear, coal, and natural gas facilities. It also develops, constructs, and operates long-term contracted assets that consists of clean energy solutions, such as renewable generation facilities, battery storage projects, and electric transmission facilities; sells energy commodities; and owns, develops, constructs, manages and operates electric generation facilities in wholesale energy markets. As of December 31, 2022, the company had approximately 32,100 megawatts of net generating capacity; approximately 88,000 circuit miles of transmission and distribution lines; and 871 substations. It serves approximately 12 million people through approximately 5.8 million customer accounts in the east and lower west coasts of Florida. The company was formerly known as FPL Group, Inc. and changed its name to NextEra Energy, Inc. in 2010. NextEra Energy, Inc. was founded in 1925 and is headquartered in Juno Beach, Florida.
Record Renewable Energy Additions – NextEra Energy Resources expanded its backlog by 12 GW of new renewables and battery storage projects in 2024, bringing the total backlog to more than 25 GW, reinforcing its leadership in clean energy.
Strong Adjusted EPS Growth – NextEra Energy's adjusted earnings per share (EPS) grew 8.2% year-over-year, increasing from $3.17 in 2023 to $3.43 in 2024, demonstrating consistent financial growth.
NextEra Energy Resources Q4 Loss – The division reported a GAAP net loss of $442 million in Q4 2024, compared to a net income of $885 million in Q4 2023, indicating financial volatility in this segment.
Decline in GAAP Net Income – The company’s GAAP net income fell from $7.31 billion in 2023 to $6.95 billion in 2024, reflecting a 4.96% decrease, potentially impacting investor sentiment.
Key investment risks specific to NextEra Energy, Inc. include regulatory changes, exposure to volatile energy prices, environmental and climate-related risks, and the execution challenges associated with large-scale renewable energy projects.
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 70.89 | 62.0 | 76.0 | 82.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
Full-Year Financial and Operational Highlights
NextEra Energy, Inc. (NYSE: NEE) reported strong financial and operational results for the fourth quarter and full-year 2024. The company achieved a full-year net income of $6.946 billion, or $3.37 per share, on a GAAP basis, compared to $7.310 billion, or $3.60 per share, in 2023. On an adjusted basis, full-year earnings were $7.063 billion, or $3.43 per share, representing an 8.2% year-over-year increase. Fourth-quarter GAAP net income stood at $1.203 billion, or $0.58 per share, slightly lower than the $1.210 billion, or $0.59 per share, reported for the same period in 2023. Adjusted earnings for the quarter were $1.095 billion, or $0.53 per share, up from $1.067 billion, or $0.52 per share, in the prior-year quarter.
Florida Power & Light (FPL) Performance and Investments
FPL continued its strong operational performance with a full-year GAAP net income of $4.543 billion, or $2.21 per share, compared to $4.552 billion, or $2.24 per share, in 2023. On an adjusted basis, FPL’s 2024 full-year earnings were $4.543 billion, reflecting continued growth driven by smart capital investments. In 2024, the company invested approximately $8.2 billion in capital projects, including the commissioning of 2.2 gigawatts (GW) of new solar energy capacity and grid infrastructure improvements. FPL's regulatory capital employed increased by approximately 10% year-over-year, demonstrating its commitment to enhancing reliability while maintaining competitive customer billing rates nearly 40% below the national average.
NextEra Energy Resources’ Record Renewable Expansion
NextEra Energy Resources achieved another record year for renewable energy and battery storage project origination, adding more than 12 GW to its backlog. The segment placed over 6 GW of new renewable energy projects into service over the last four quarters, contributing to a total backlog exceeding 25 GW. Despite reporting a GAAP net loss of $442 million for the fourth quarter, compared to net income of $885 million in the prior-year period, its adjusted earnings for the same period rose to $446 million, or $0.22 per share, from $361 million, or $0.18 per share, in 2023. For the full year, adjusted earnings increased to $3.118 billion, or $1.51 per share, from $2.757 billion, or $1.36 per share, in the prior year.
Strategic Developments and Regulatory Progress
NextEra Energy Resources is actively evaluating the recommissioning of the Duane Arnold Energy Center in Iowa. The company recently filed a licensing change request with the Nuclear Regulatory Commission, marking a crucial step toward restoring the facility’s operating license. If approved, the plant could restart operations as early as the end of 2028. Additionally, FPL initiated a regulatory rate review process with the Florida Public Service Commission for new base rates starting in January 2026. The proposed plan aims to support ongoing infrastructure enhancements while ensuring cost-effective electricity pricing, with projected average annual bill increases of approximately 2.5% from 2025 to 2029.
Corporate and Other Financial Adjustments
The Corporate and Other segment recorded an increase of $0.78 per share in fourth-quarter GAAP earnings compared to the previous year. On an adjusted basis, fourth-quarter results declined by $0.03 per share year-over-year. For the full year, the segment’s GAAP earnings increased by $0.43 per share, while adjusted earnings decreased by $0.01 per share compared to 2023. These fluctuations reflect the company’s broader financial adjustments and investment strategies aimed at sustaining long-term profitability.
Financial Outlook and Growth Expectations
NextEra Energy reaffirmed its long-term financial projections, expecting adjusted earnings per share in the range of $3.45 to $3.70 for 2025. The company anticipates earnings to grow within the ranges of $3.63 to $4.00 in 2026 and $3.85 to $4.32 in 2027. Additionally, the company aims to maintain an annual dividend growth rate of approximately 10% through at least 2026. Leadership remains committed to sustaining financial strength while capitalizing on increasing U.S. power demand and renewable energy expansion opportunities.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given on NextEra Energy, Inc (NYSE: NEE) at the closing price of USD 70.89, as on January 29, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Utilities Industry: Utilities - Regulated Electric
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| NEE Nextera Energy Inc |
-2.37 3.19% | 72.04 | 15.77 | 17.61 | 4.52 | 2.61 | 7.10 | 12.28 |
| SO Southern Company |
-0.87 0.96% | 89.96 | 25.35 | 17.76 | 2.89 | 2.48 | 5.27 | 13.35 |
| DUK Duke Energy Corporation |
-0.44 0.38% | 116.87 | 20.54 | 16.34 | 2.60 | 1.59 | 5.34 | 11.98 |
| AEP American Electric Power Co Inc |
-0.425 0.41% | 103.31 | 19.17 | 16.18 | 2.58 | 1.91 | 4.83 | 12.39 |
| NGG National Grid PLC ADR |
0.49 0.67% | 73.91 | 15.63 | 13.83 | 2.41 | 1.32 | 5.05 | 14.80 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is January 29, 2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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