NEXTERA ENERGY INC (NEE) Stock Fundamental Analysis
NYSE:NEE - New York Stock Exchange, Inc. - US65339F1012 - Common Stock - Currency: USD
Overall NEE gets a fundamental rating of 4 out of 10. We evaluated NEE against 47 industry peers in the Electric Utilities industry. NEE has a medium profitability rating, but doesn't score so well on its financial health evaluation. While showing a medium growth rate, NEE is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
NEE had positive earnings in the past year.
In the past year NEE had a positive cash flow from operations.
Each year in the past 5 years NEE has been profitable.
In the past 5 years NEE always reported a positive cash flow from operatings.
1.2 Ratios
NEE's Return On Assets of 2.84% is in line compared to the rest of the industry. NEE outperforms 46.81% of its industry peers.
With a decent Return On Equity value of 11.06%, NEE is doing good in the industry, outperforming 65.96% of the companies in the same industry.
With a Return On Invested Capital value of 3.84%, NEE is not doing good in the industry: 63.83% of the companies in the same industry are doing better.
NEE had an Average Return On Invested Capital over the past 3 years of 3.99%. This 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.
The Operating Margin of NEE (29.26%) is better than 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
NEE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, NEE has more shares outstanding
The number of shares outstanding for NEE has been increased compared to 5 years ago.
The debt/assets ratio for NEE is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.07, we must say that NEE is in the distress zone and has some risk of bankruptcy.
NEE's Altman-Z score of 1.07 is fine compared to the rest of the industry. NEE outperforms 63.83% of its industry peers.
NEE has a debt to FCF ratio of 20.36. This is a negative value and a sign of low solvency as NEE would need 20.36 years to pay back of all of its debts.
NEE's Debt to FCF ratio of 20.36 is fine compared to the rest of the industry. NEE outperforms 76.60% of its industry peers.
A Debt/Equity ratio of 1.65 is on the high side and indicates that NEE has dependencies on debt financing.
NEE has a worse Debt to Equity ratio (1.65) than 63.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 20.36 | ||
| Altman-Z | 1.07 |
ROIC/WACC0.54
WACC7.12%
2.3 Liquidity
NEE has a Current Ratio of 0.55. This is a bad value and indicates that NEE is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of NEE (0.55) is worse than 82.98% of its industry peers.
NEE has a Quick Ratio of 0.55. This is a bad value and indicates that NEE is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.45, NEE is not doing good in the industry: 80.85% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.55 | ||
| Quick Ratio | 0.45 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 8.00% over the past year.
Measured over the past years, NEE shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.36% on average per year.
NEE shows a decrease in Revenue. In the last year, the revenue decreased by -6.86%.
NEE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.21% yearly.
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.
NEE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.28% yearly.
EPS Next Y7.88%
EPS Next 2Y8.2%
EPS Next 3Y8.6%
EPS Next 5Y8.33%
Revenue Next Year4.89%
Revenue Next 2Y7.13%
Revenue Next 3Y7.62%
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
Based on the Price/Earnings ratio of 21.64, the valuation of NEE can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of NEE indicates a slightly more expensive valuation: NEE is more expensive than 74.47% of the companies listed in the same industry.
NEE's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.50.
Based on the Price/Forward Earnings ratio of 18.91, the valuation of NEE can be described as rather expensive.
Based on the Price/Forward Earnings ratio, NEE is valued a bit more expensive than the industry average as 74.47% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of NEE to the average of the S&P500 Index (36.44), we can say NEE is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.64 | ||
| Fwd PE | 18.91 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NEE is valued more expensive than 85.11% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NEE indicates a somewhat cheap valuation: NEE is cheaper than 78.72% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.49 | ||
| EV/EBITDA | 17.97 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NEE does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of NEE may justify a higher PE ratio.
PEG (NY)2.75
PEG (5Y)2.09
EPS Next 2Y8.2%
EPS Next 3Y8.6%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.01%, NEE has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.54, NEE is paying slightly less dividend.
NEE's Dividend Yield is a higher than the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.01% |
5.2 History
On average, the dividend of NEE grows each year by 10.61%, which is quite nice.
NEE has been paying a dividend for at least 10 years, so it has 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
NEE pays out 78.82% of its income as dividend. 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 2Y8.2%
EPS Next 3Y8.6%
75.95
+0.77 (+1.02%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners83.13%
Inst Owner Change0%
Ins Owners0.06%
Ins Owner Change6.76%
Market Cap156.35B
Analysts76.15
Price Target82.29 (8.35%)
Short Float %1.71%
Short Ratio2.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.01% |
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)-0.06%
PT rev (3m)-4.2%
EPS NQ rev (1m)1.24%
EPS NQ rev (3m)-5.12%
EPS NY rev (1m)-0.23%
EPS NY rev (3m)-0.44%
Revenue NQ rev (1m)0.46%
Revenue NQ rev (3m)-1.75%
Revenue NY rev (1m)0.69%
Revenue NY rev (3m)-2.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.64 | ||
| Fwd PE | 18.91 | ||
| P/S | 6.19 | ||
| P/FCF | 35.49 | ||
| P/OCF | 12.07 | ||
| P/B | 3.14 | ||
| P/tB | 3.48 | ||
| EV/EBITDA | 17.97 |
EPS(TTM)3.51
EY4.62%
EPS(NY)4.02
Fwd EY5.29%
FCF(TTM)2.14
FCFY2.82%
OCF(TTM)6.29
OCFY8.28%
SpS12.27
BVpS24.2
TBVpS21.83
PEG (NY)2.75
PEG (5Y)2.09
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 | 1.07 |
F-Score4
WACC7.12%
ROIC/WACC0.54
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 Y7.88%
EPS Next 2Y8.2%
EPS Next 3Y8.6%
EPS Next 5Y8.33%
Revenue 1Y (TTM)-6.86%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%9%
Revenue Next Year4.89%
Revenue Next 2Y7.13%
Revenue Next 3Y7.62%
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%