NextEra Energy Beats EPS Estimates Amid Revenue Concerns

NextEra Energy reports lower-than-expected revenue but beats EPS estimates, fueling a stock surge. Analysts remain optimistic about modest EPS growth over the next few years.

Date: 01-02-2025

AI Rating: 6

The report about NextEra Energy, Inc. highlights several critical factors that could impact its stock price. One of the key takeaways is the company's adjusted Earnings Per Share (EPS). NextEra Energy reported an adjusted EPS of $0.53, surpassing consensus estimates and indicating year-over-year growth. Analysts expect that EPS will continue to grow, projecting an increase to $3.68 for the current fiscal year, reflecting a year-over-year growth rate of 7.3%.

The revenue growth figures, however, presented a less favorable picture. The company reported lower-than-expected Q4 revenue of $5.5 billion, which may raise concerns among investors regarding its overall financial health relative to market expectations, particularly since it underperformed the S&P 500 and the Utilities Select Sector SPDR Fund recently.

Alongside these figures, the profit margins were not explicitly mentioned in the report, but the company’s commitment to maintaining a 6% to 8% annual EPS growth through 2027 and increasing dividends by approximately 10% per year through at least 2026 could suggest maintained profitability and a solid investor outlook.

Notably, the sentiment around NextEra Energy spiked due to news of adding 3.3 GW to its renewables backlog and its new partnership with GE Vernova for natural-gas-fired projects. This could indicate potential revenue increases in the future, although revenue figures in this instance did not meet expectations.

In terms of investor sentiment, the report showcases a moderately positive outlook, with rating consensus leaning towards a 'Moderate Buy,' supported by favorable actions such as Goldman Sachs maintaining a 'Buy' rating with a price target of $94. The current price is stated to be below the mean price target and indicates a potential upside of 42.5%, which could entice investors looking for opportunities.

Stocks: NEE