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 3 out of 10. We evaluated NEE against 47 industry peers in the Electric Utilities industry. There are concerns on the financial health of NEE while its profitability can be described as average. NEE is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year NEE was profitable.
In the past year NEE had a positive cash flow from operations.
In the past 5 years NEE has always been profitable.
NEE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of NEE (2.84%) is comparable to the rest of the industry.
NEE has a Return On Equity of 11.06%. This is in the better half of the industry: NEE outperforms 65.96% of its industry peers.
NEE's Return On Invested Capital of 3.84% is on the low side compared to the rest of the industry. NEE is outperformed by 63.83% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NEE 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
With an excellent Profit Margin value of 21.81%, NEE belongs to the best of the industry, outperforming 91.49% of the companies in the same industry.
In the last couple of years the Profit Margin of NEE has grown nicely.
NEE has a Operating Margin of 29.26%. This is amongst the best in the industry. NEE outperforms 93.62% of its industry peers.
In the last couple of years the Operating Margin of NEE has grown nicely.
| 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.
NEE has more shares outstanding than it did 1 year ago.
The number of shares outstanding for NEE has been increased compared to 5 years ago.
Compared to 1 year ago, NEE has a worse debt to assets ratio.
2.2 Solvency
NEE has an Altman-Z score of 1.06. This is a bad value and indicates that NEE is not financially healthy and even has some risk of bankruptcy.
NEE has a better Altman-Z score (1.06) than 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 has a Debt to FCF ratio of 20.36. This is in the better half of the industry: NEE outperforms 76.60% of its industry peers.
NEE has a Debt/Equity ratio of 1.65. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.65, NEE is not doing good in the industry: 63.83% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 20.36 | ||
| Altman-Z | 1.06 |
ROIC/WACC0.55
WACC7.02%
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.
NEE has a Current ratio of 0.55. This is amonst the worse of the industry: NEE underperforms 82.98% of its industry peers.
A Quick Ratio of 0.45 indicates that NEE may have some problems paying its short term obligations.
NEE has a Quick ratio of 0.45. This is amonst the worse of the industry: NEE underperforms 80.85% of its industry peers.
| 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.
NEE shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.36% yearly.
Looking at the last year, NEE shows a decrease in Revenue. The Revenue has decreased by -6.86% in the last year.
Measured over the past years, NEE shows a small growth in Revenue. The Revenue has been growing by 5.21% on average per year.
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
NEE is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.33% yearly.
Based on estimates for the next years, NEE will show a small growth in Revenue. The Revenue will grow by 7.28% on average per year.
EPS Next Y7.9%
EPS Next 2Y8.23%
EPS Next 3Y8.55%
EPS Next 5Y8.33%
Revenue Next Year4.17%
Revenue Next 2Y6.71%
Revenue Next 3Y7.44%
Revenue Next 5Y7.28%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
A Price/Earnings ratio of 21.05 indicates a rather expensive valuation of NEE.
Compared to the rest of the industry, the Price/Earnings ratio of NEE indicates a slightly more expensive valuation: NEE is more expensive than 76.60% 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 27.45.
NEE is valuated rather expensively with a Price/Forward Earnings ratio of 18.39.
Based on the Price/Forward Earnings ratio, NEE is valued a bit more expensive than 72.34% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of NEE to the average of the S&P500 Index (21.90), we can say NEE is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.05 | ||
| Fwd PE | 18.39 |
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.
78.72% of the companies in the same industry are more expensive than NEE, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.53 | ||
| EV/EBITDA | 17.77 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NEE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.66
PEG (5Y)2.03
EPS Next 2Y8.23%
EPS Next 3Y8.55%
5. Dividend
5.1 Amount
NEE has a Yearly Dividend Yield of 3.07%. Purely for dividend investing, there may be better candidates out there.
NEE's Dividend Yield is slightly below the industry average, which is at 3.64.
Compared to an average S&P500 Dividend Yield of 2.38, NEE pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.07% |
5.2 History
The dividend of NEE is nicely growing with an annual growth rate of 10.61%!
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 2Y8.23%
EPS Next 3Y8.55%
73.88
+0.86 (+1.18%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners83.13%
Inst Owner Change-45.49%
Ins Owners0.06%
Ins Owner Change6.76%
Market Cap152.09B
Analysts76.15
Price Target82.73 (11.98%)
Short Float %1.7%
Short Ratio2.68
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.07% |
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)-1.59%
PT rev (3m)-4.2%
EPS NQ rev (1m)1.6%
EPS NQ rev (3m)-4.92%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)-0.42%
Revenue NQ rev (1m)0.82%
Revenue NQ rev (3m)-1.54%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.05 | ||
| Fwd PE | 18.39 | ||
| P/S | 6.02 | ||
| P/FCF | 34.53 | ||
| P/OCF | 11.74 | ||
| P/B | 3.05 | ||
| P/tB | 3.38 | ||
| EV/EBITDA | 17.77 |
EPS(TTM)3.51
EY4.75%
EPS(NY)4.02
Fwd EY5.44%
FCF(TTM)2.14
FCFY2.9%
OCF(TTM)6.29
OCFY8.52%
SpS12.27
BVpS24.2
TBVpS21.83
PEG (NY)2.66
PEG (5Y)2.03
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 | 1.06 |
F-Score4
WACC7.02%
ROIC/WACC0.55
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 Y7.9%
EPS Next 2Y8.23%
EPS Next 3Y8.55%
EPS Next 5Y8.33%
Revenue 1Y (TTM)-6.86%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%9%
Revenue Next Year4.17%
Revenue Next 2Y6.71%
Revenue Next 3Y7.44%
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%