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NextEra Beats on Q1 Earnings: ETFs in Focus

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Shares of NextEra Energy Inc. (NEE - Free Report) were up 1.64% at market close on Friday, April 21, 2017, as the company reported better than expected results. The company reported a 3.57% year-over-year increase in first quarter of 2017 revenues. Moreover, it beat the Zacks Consensus Estimate on both earnings and revenue (read: NextEra Energy Beats Q1 Earnings, Revenue Estimates).


Q1 Performance


NextEra Energy reported non-GAAP earnings per share (EPS) of $1.75, up 12.9% year over year and beating the Zacks Consensus Estimate of $1.56. Moreover, revenues of $3.972 billion came ahead of the consensus mark of $3.943 billion.


The company reported operating income of $2.405 billion, up from $1.234 billion a year ago.


Revenue Performance


Florida Power and Light revenue rose to $2.527 billion from $2.303 billion.


NextEra Energy Resources revenues dropped to $1.424 billion from $1.441 billion a year ago.


Corporate and Other revenues dropped to $21 million from $91 million a year ago.


Guidance


NextEra Energy expects adjusted EPS to be in a range of $6.35-$6.85 for 2017 and $6.80-$7.30 for 2018.


In the current scenario, let us discuss the following ETFs with a high exposure to NextEra Energy.


Utilities Select Sector SPDR Fund (XLU - Free Report)


This fund is one of the most popular ETFs providing exposure to the U.S. utilities sector. It has AUM of $7.52 billion and charges a fee of 14 basis points a year. It has a 9.50% allocation to NextEra energy (as of April 24, 2017). The fund returned 9.45% in the past one year and 7.06% in the year-to-date time frame (as of April 24, 2017). It closed 0.51% higher on Friday, April 21, 2017. XLU currently has a Zacks ETF Rank of #4 (Sell) with a Medium risk outlook (read: See How ETFs React When Hawks Act Like Doves).


iShares U.S. Utilities ETF (IDU - Free Report)


This ETF tracks the performance of the U.S. utilities sector and is relatively expensive. It has AUM of $808.40 million and charges a fee of 43 basis points a year. It has 8.24% allocation to NextEra Energy (as of April 21, 2017). The fund returned 9.35% in the past one year and 6.70% in the year-to-date time frame (as of April 24, 2017). It closed 0.58% higher on Friday, April 21, 2017. IDU currently has a Zacks ETF Rank of #4 with a Medium risk outlook.


Fidelity MSCI Utilities Index ETF (FUTY - Free Report)


This ETF is a relatively cheaper bet on the U.S. utilities sector. It has AUM of $281.8 million and charges a fee of 8 basis points a year. It has 7.95% allocation to NextEra  (as of April 21, 2017). The fund returned 10.05% in the past one year and 6.71% in the year-to-date time frame (as of April 24, 2017). It closed 0.51% higher on Friday, April 21, 2017. FUTY currently has a Zacks ETF Rank of #4 with a Medium risk outlook.


Below is a year-to-date performance comparison of the funds and NextEra Energy Inc.
 


Source: Yahoo Finance


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