NEXTERA ENERGY INC (NEE) Stock Fundamental Analysis
NYSE:NEE - New York Stock Exchange, Inc. - US65339F1012 - Common Stock - Currency: USD
Taking everything into account, NEE scores 4 out of 10 in our fundamental rating. NEE was compared to 46 industry peers in the Electric Utilities industry. While NEE has a great profitability rating, there are quite some concerns on its financial health. NEE has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year NEE was profitable.
NEE had a positive operating cash flow in the past year.
NEE had positive earnings in each of the past 5 years.
In the past 5 years NEE always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 3.65%, NEE belongs to the best of the industry, outperforming 82.61% of the companies in the same industry.
The Return On Equity of NEE (13.86%) is better than 89.13% of its industry peers.
NEE's Return On Invested Capital of 3.86% is fine compared to the rest of the industry. NEE outperforms 60.87% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NEE is in line with the industry average of 4.92%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.65% | ||
| ROE | 13.86% | ||
| ROIC | 3.86% |
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's Profit Margin of 28.06% is amongst the best of the industry. NEE outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of NEE has grown nicely.
NEE's Operating Margin of 28.80% is amongst the best of the industry. NEE outperforms 97.83% of its industry peers.
In the last couple of years the Operating Margin of NEE has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.8% | ||
| PM (TTM) | 28.06% | ||
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), NEE 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 1.00. This is a bad value and indicates that NEE is not financially healthy and even has some risk of bankruptcy.
NEE has a Altman-Z score of 1.00. This is in the better half of the industry: NEE outperforms 73.91% of its industry peers.
NEE has a debt to FCF ratio of 17.35. This is a negative value and a sign of low solvency as NEE would need 17.35 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 17.35, NEE belongs to the best of the industry, outperforming 89.13% of the companies in the same industry.
A Debt/Equity ratio of 1.48 is on the high side and indicates that NEE has dependencies on debt financing.
NEE has a Debt to Equity ratio (1.48) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.48 | ||
| Debt/FCF | 17.35 | ||
| Altman-Z | 1 |
ROIC/WACC0.56
WACC6.87%
2.3 Liquidity
A Current Ratio of 0.47 indicates that NEE may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.47, NEE is doing worse than 71.74% of the companies in the same industry.
NEE has a Quick Ratio of 0.47. 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 Quick ratio of NEE (0.38) is worse than 69.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.47 | ||
| Quick Ratio | 0.38 |
3. Growth
3.1 Past
NEE shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.86%.
The Earnings Per Share has been growing by 10.36% on average over the past years. This is quite good.
NEE shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -11.96%.
The Revenue has been growing slightly by 5.21% on average over the past years.
EPS 1Y (TTM)7.86%
EPS 3Y10.53%
EPS 5Y10.36%
EPS Q2Q%1.92%
Revenue 1Y (TTM)-11.96%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%-21.7%
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 8.94% on average per year.
NEE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.80% yearly.
EPS Next Y8.35%
EPS Next 2Y8.35%
EPS Next 3Y8.57%
EPS Next 5Y8.94%
Revenue Next Year7.12%
Revenue Next 2Y7.7%
Revenue Next 3Y8.01%
Revenue Next 5Y6.8%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.33, the valuation of NEE can be described as rather expensive.
NEE's Price/Earnings is on the same level as the industry average.
NEE is valuated rather cheaply when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 17.84, which indicates a rather expensive current valuation of NEE.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NEE indicates a somewhat cheap valuation: NEE is cheaper than 63.04% of the companies listed in the same industry.
NEE is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.33 | ||
| Fwd PE | 17.84 |
4.2 Price Multiples
69.57% of the companies in the same industry are cheaper than NEE, based on the Enterprise Value to EBITDA ratio.
82.61% 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 | 28.76 | ||
| EV/EBITDA | 16.72 |
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)2.31
PEG (5Y)1.87
EPS Next 2Y8.35%
EPS Next 3Y8.57%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.40%, NEE has a reasonable but not impressive dividend return.
NEE's Dividend Yield is comparable with the industry average which is at 3.57.
Compared to an average S&P500 Dividend Yield of 2.57, NEE pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.4% |
5.2 History
The dividend of NEE is nicely growing with an annual growth rate of 10.61%!
NEE has paid a dividend for at least 10 years, which is 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 60.98% of its income as dividend. This is not a sustainable payout ratio.
NEE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP60.98%
EPS Next 2Y8.35%
EPS Next 3Y8.57%
66.31
+0.67 (+1.02%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners83.4%
Inst Owner Change0%
Ins Owners0.06%
Ins Owner Change7.64%
Market Cap136.50B
Analysts77.04
Price Target86.36 (30.24%)
Short Float %1.92%
Short Ratio3.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.4% |
Yearly Dividend2.06
Dividend Growth(5Y)10.61%
DP60.98%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.76%
Min EPS beat(2)-0.12%
Max EPS beat(2)3.63%
EPS beat(4)2
Avg EPS beat(4)4.13%
Min EPS beat(4)-2.94%
Max EPS beat(4)15.94%
EPS beat(8)6
Avg EPS beat(8)6.25%
EPS beat(12)10
Avg EPS beat(12)5.87%
EPS beat(16)14
Avg EPS beat(16)5.6%
Revenue beat(2)0
Avg Revenue beat(2)-16.07%
Min Revenue beat(2)-24.58%
Max Revenue beat(2)-7.56%
Revenue beat(4)0
Avg Revenue beat(4)-14.58%
Min Revenue beat(4)-24.58%
Max Revenue beat(4)-7.56%
Revenue beat(8)4
Avg Revenue beat(8)-0.11%
Revenue beat(12)5
Avg Revenue beat(12)-3.16%
Revenue beat(16)5
Avg Revenue beat(16)-7.76%
PT rev (1m)0.12%
PT rev (3m)-3.64%
EPS NQ rev (1m)0.3%
EPS NQ rev (3m)1.8%
EPS NY rev (1m)-0.15%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)1.12%
Revenue NQ rev (3m)3.84%
Revenue NY rev (1m)-0.84%
Revenue NY rev (3m)-2.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.33 | ||
| Fwd PE | 17.84 | ||
| P/S | 5.51 | ||
| P/FCF | 28.76 | ||
| P/OCF | 10.29 | ||
| P/B | 2.72 | ||
| P/tB | 3.02 | ||
| EV/EBITDA | 16.72 |
EPS(TTM)3.43
EY5.17%
EPS(NY)3.72
Fwd EY5.6%
FCF(TTM)2.31
FCFY3.48%
OCF(TTM)6.44
OCFY9.71%
SpS12.02
BVpS24.34
TBVpS21.97
PEG (NY)2.31
PEG (5Y)1.87
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.65% | ||
| ROE | 13.86% | ||
| ROCE | 4.33% | ||
| ROIC | 3.86% | ||
| ROICexc | 3.9% | ||
| ROICexgc | 4.01% | ||
| OM | 28.8% | ||
| PM (TTM) | 28.06% | ||
| GM | N/A | ||
| FCFM | 19.17% |
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 | 1.48 | ||
| Debt/FCF | 17.35 | ||
| Debt/EBITDA | 5.76 | ||
| Cap/Depr | 147.79% | ||
| Cap/Sales | 34.4% | ||
| Interest Coverage | 2.6 | ||
| Cash Conversion | 102.88% | ||
| Profit Quality | 68.34% | ||
| Current Ratio | 0.47 | ||
| Quick Ratio | 0.38 | ||
| Altman-Z | 1 |
F-Score4
WACC6.87%
ROIC/WACC0.56
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)7.86%
EPS 3Y10.53%
EPS 5Y10.36%
EPS Q2Q%1.92%
EPS Next Y8.35%
EPS Next 2Y8.35%
EPS Next 3Y8.57%
EPS Next 5Y8.94%
Revenue 1Y (TTM)-11.96%
Revenue growth 3Y13.19%
Revenue growth 5Y5.21%
Sales Q2Q%-21.7%
Revenue Next Year7.12%
Revenue Next 2Y7.7%
Revenue Next 3Y8.01%
Revenue Next 5Y6.8%
EBIT growth 1Y-27.5%
EBIT growth 3Y35.51%
EBIT growth 5Y7.12%
EBIT Next Year76.35%
EBIT Next 3Y29.93%
EBIT Next 5Y18.97%
FCF growth 1Y170.74%
FCF growth 3Y111.03%
FCF growth 5Y16.17%
OCF growth 1Y17.33%
OCF growth 3Y20.64%
OCF growth 5Y10.21%