NextEra Energy, Inc.
NextEra Energy, Inc. Fundamental Analysis
NextEra Energy, Inc. (NEE) shows strong financial fundamentals with a PE ratio of 24.12, profit margin of 29.30%, and ROE of 15.24%. The company generates $28.2B in annual revenue with strong year-over-year growth of 11.00%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 66.1/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze NEE's fundamental strength across five key dimensions:
Efficiency Score
WeakNEE struggles to generate sufficient returns from assets.
Valuation Score
ExcellentNEE trades at attractive valuation levels.
Growth Score
ModerateNEE shows steady but slowing expansion.
Financial Health Score
ModerateNEE shows balanced financial health with some risks.
Profitability Score
ExcellentNEE achieves industry-leading margins.
Key Financial Metrics
Is NEE Expensive or Cheap?
P/E Ratio
NEE trades at 24.12 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, NEE's PEG of -11.65 indicates potential undervaluation.
Price to Book
The market values NextEra Energy, Inc. at 3.57 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 13.10 times EBITDA. This signals the market has high growth expectations.
How Well Does NEE Make Money?
Net Profit Margin
For every $100 in sales, NextEra Energy, Inc. keeps $29.30 as profit after all expenses.
Operating Margin
Core operations generate 29.47 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $15.24 in profit for every $100 of shareholder equity.
ROA
NextEra Energy, Inc. generates $3.70 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
NextEra Energy, Inc. generates strong operating cash flow of $12.44B, reflecting robust business health.
Free Cash Flow
NextEra Energy, Inc. generates strong free cash flow of $5.60B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $2.69 in free cash annually.
FCF Yield
NEE converts 2.79% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
24.12
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-11.65
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.57
vs 25 benchmark
P/S Ratio
Price to sales ratio
7.13
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.19
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.54
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.15
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.04
vs 25 benchmark
How NEE Stacks Against Its Sector Peers
| Metric | NEE Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 24.12 | 20.38 | Worse (Expensive) |
| ROE | 15.24% | 908.00% | Weak |
| Net Margin | 29.30% | 805.00% | Weak |
| Debt/Equity | 0.19 | 1.47 | Strong (Low Leverage) |
| Current Ratio | 0.54 | 1.51 | Weak Liquidity |
| ROA | 3.70% | -5945.00% (disorted) | Weak |
NEE outperforms its industry in 1 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews NextEra Energy, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
43.17%
Industry Style: Defensive, Dividend, Income
High GrowthEPS CAGR
119.55%
Industry Style: Defensive, Dividend, Income
High GrowthFCF CAGR
46.66%
Industry Style: Defensive, Dividend, Income
High Growth