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NEE Stock Falls Behind Industry in 3 Months: Should You Buy Now?
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Key Takeaways
NEE stock lost 10.5% in three months, underperforming the industry's 9.4% decline amid investor concerns.
NEE plans to invest over $94.1B through 2030, with renewable capacity additions targeted through 2032.
NEE's 12.28% ROE and 3.16% dividend yield offer strength, but its 18.29X forward P/E signals a premium.
Shares of NextEra Energy (NEE - Free Report) have lost 10.5% in the past three months, lagging the Zacks Utility - Electric Power industry’s decline of 9.4%. The company also lagged the Zacks Utilities sector and the S&P 500’s return in the same time frame.
NextEra Energy’s recent share price volatility reflects investor concerns over its substantial long-term capital expenditure plans and potential share dilution associated with the proposed acquisition of Dominion Energy. However, increasing electricity demand from data centers, AI applications and continued electrification, along with growing corporate demand for clean energy, positions the company for solid long-term growth.
Price Performance (Three months)
Image Source: Zacks Investment Research
Another company, Duke Energy Corporation (DUK - Free Report) , has a strong capacity to generate clean electricity and a strong long-term capital expenditure plan to strengthen its operations. In the past three months, shares of Duke Energy have declined 4%.
Should you consider adding NEE to your portfolio only based on recent softness in share price movements? Let’s delve deeper and find out the factors that can help investors decide whether it is a good entry point to add the stock to their portfolio.
NextEra Energy’s long-term growth is supported by planned capital investments of more than $94.1 billion through 2030 across its Florida Power & Light (“FPL”) and Energy Resources businesses. These investments aim to expand generation capacity, modernize grid infrastructure and improve reliability, while supporting regulated rate-base expansion and steady earnings growth.
Energy Resources continues to expand its renewable energy portfolio, targeting 76.6-107.6 gigawatts (GW) of capacity additions between 2026 and 2032. Its renewable development backlog of more than 33 GW provides visibility into growth opportunities and strengthens the company’s long-term prospects.
Florida’s robust economic growth continues to drive electricity demand, creating attractive expansion opportunities for NextEra Energy. The company’s ongoing investments in infrastructure development and grid modernization position it to capitalize on rising demand. Moreover, Florida Power & Light’s residential electricity rates remain well below the national average, supporting customer growth and long-term earnings potential.
NextEra Energy also benefits from its low-cost operating structure, backed by operational efficiency, a large renewable energy portfolio and strategically located assets. These strengths support profitability, enhance its competitive position and provide a solid foundation for sustained long-term growth.
NextEra Energy’s Earnings Estimates Moving North
The Zacks Consensus Estimate for NEE’s 2026 and 2027 earnings per share indicates an increase of 0.50% and 0.46%, respectively in the past 60 days.
Image Source: Zacks Investment Research
The same for DUK’s 2026 and 2027 earnings per share has remained unchanged in the past 60 days.
NextEra Energy’s Earnings Surprise
NextEra Energy’s earnings beat estimates in each of the past four quarters, resulting in an average surprise of 6.82%.
Image Source: Zacks Investment Research
Another utility, The Southern Company (SO - Free Report) , is also making systematic investments in expanding its clean energy generation portfolio. The company reported positive earnings surprise in three out of the past four quarters and missed in the remaining quarter, resulting in an average surprise of 6.46%.
NEE Stock Returns Better Than Its Industry
Return on equity (“ROE”) is a financial ratio that measures how well a company uses its shareholders’ equity to generate profits. The current ROE of the company indicates that it is using shareholders’ funds more efficiently than peers.
NextEra Energy’s trailing 12-month ROE is 12.28%, ahead of the industry average of 11.4%.
Image Source: Zacks Investment Research
The Southern Company’s ROE is 12.93% better than the industry average.
NextEra Energy Increases Shareholders Value
NextEra Energy has authorization in place to repurchase as many as 180 million shares over an unspecified duration. The company also aims to increase its dividend by nearly 10% annually through at least 2026, followed by approximately 6% yearly growth from the end of 2026 through 2028, pending board approval.
NEE’s current quarterly dividend is 62.32 cents per share, while the dividend yield of 3.16% remains higher than 1.37% of the S&P 500 composite.
NextEra Energy has raised its dividend five times in the past five years. You can find more details on NextEra Energy’s dividend here.
NextEra Energy’s Shares Trading at a Premium
The company is currently valued at a premium compared with its industry on a forward 12-month P/E basis. NextEra Energy is currently trading at 18.29X compared with the industry average of 14.17X.
Image Source: Zacks Investment Research
Summing Up
NextEra Energy continues to maintain stable operational and financial performance, driven by increasing demand for clean energy across its operating regions. The company is actively expanding the clean energy portfolio to capitalize on rising demand, while Florida’s strong economic growth provides additional opportunities to strengthen its regulated utility operations.
This Zacks Rank #3 (Hold) company is well positioned to capitalize on strong residential customer demand. Upward revisions in earnings estimates and a return on equity exceeding the industry average further strengthen its investment prospects.
NextEra Energy’s premium valuation suggests that new investors may benefit from waiting for a more favorable entry point before investing in the stock to capitalize on its long-term growth potential.
View the Zacks #1 Rank List
Image: Bigstock
NEE Stock Falls Behind Industry in 3 Months: Should You Buy Now?
Key Takeaways
Shares of NextEra Energy (NEE - Free Report) have lost 10.5% in the past three months, lagging the Zacks Utility - Electric Power industry’s decline of 9.4%. The company also lagged the Zacks Utilities sector and the S&P 500’s return in the same time frame.
NextEra Energy’s recent share price volatility reflects investor concerns over its substantial long-term capital expenditure plans and potential share dilution associated with the proposed acquisition of Dominion Energy. However, increasing electricity demand from data centers, AI applications and continued electrification, along with growing corporate demand for clean energy, positions the company for solid long-term growth.
Price Performance (Three months)
Image Source: Zacks Investment Research
Another company, Duke Energy Corporation (DUK - Free Report) , has a strong capacity to generate clean electricity and a strong long-term capital expenditure plan to strengthen its operations. In the past three months, shares of Duke Energy have declined 4%.
Should you consider adding NEE to your portfolio only based on recent softness in share price movements? Let’s delve deeper and find out the factors that can help investors decide whether it is a good entry point to add the stock to their portfolio.
NEE Stock’s Growth Drivers Despite Recent Price Weakness
NextEra Energy’s long-term growth is supported by planned capital investments of more than $94.1 billion through 2030 across its Florida Power & Light (“FPL”) and Energy Resources businesses. These investments aim to expand generation capacity, modernize grid infrastructure and improve reliability, while supporting regulated rate-base expansion and steady earnings growth.
Energy Resources continues to expand its renewable energy portfolio, targeting 76.6-107.6 gigawatts (GW) of capacity additions between 2026 and 2032. Its renewable development backlog of more than 33 GW provides visibility into growth opportunities and strengthens the company’s long-term prospects.
Florida’s robust economic growth continues to drive electricity demand, creating attractive expansion opportunities for NextEra Energy. The company’s ongoing investments in infrastructure development and grid modernization position it to capitalize on rising demand. Moreover, Florida Power & Light’s residential electricity rates remain well below the national average, supporting customer growth and long-term earnings potential.
NextEra Energy also benefits from its low-cost operating structure, backed by operational efficiency, a large renewable energy portfolio and strategically located assets. These strengths support profitability, enhance its competitive position and provide a solid foundation for sustained long-term growth.
NextEra Energy’s Earnings Estimates Moving North
The Zacks Consensus Estimate for NEE’s 2026 and 2027 earnings per share indicates an increase of 0.50% and 0.46%, respectively in the past 60 days.
Image Source: Zacks Investment Research
The same for DUK’s 2026 and 2027 earnings per share has remained unchanged in the past 60 days.
NextEra Energy’s Earnings Surprise
NextEra Energy’s earnings beat estimates in each of the past four quarters, resulting in an average surprise of 6.82%.
Image Source: Zacks Investment Research
Another utility, The Southern Company (SO - Free Report) , is also making systematic investments in expanding its clean energy generation portfolio. The company reported positive earnings surprise in three out of the past four quarters and missed in the remaining quarter, resulting in an average surprise of 6.46%.
NEE Stock Returns Better Than Its Industry
Return on equity (“ROE”) is a financial ratio that measures how well a company uses its shareholders’ equity to generate profits. The current ROE of the company indicates that it is using shareholders’ funds more efficiently than peers.
NextEra Energy’s trailing 12-month ROE is 12.28%, ahead of the industry average of 11.4%.
Image Source: Zacks Investment Research
The Southern Company’s ROE is 12.93% better than the industry average.
NextEra Energy Increases Shareholders Value
NextEra Energy has authorization in place to repurchase as many as 180 million shares over an unspecified duration. The company also aims to increase its dividend by nearly 10% annually through at least 2026, followed by approximately 6% yearly growth from the end of 2026 through 2028, pending board approval.
NEE’s current quarterly dividend is 62.32 cents per share, while the dividend yield of 3.16% remains higher than 1.37% of the S&P 500 composite.
NextEra Energy has raised its dividend five times in the past five years. You can find more details on NextEra Energy’s dividend here.
NextEra Energy’s Shares Trading at a Premium
The company is currently valued at a premium compared with its industry on a forward 12-month P/E basis. NextEra Energy is currently trading at 18.29X compared with the industry average of 14.17X.
Image Source: Zacks Investment Research
Summing Up
NextEra Energy continues to maintain stable operational and financial performance, driven by increasing demand for clean energy across its operating regions. The company is actively expanding the clean energy portfolio to capitalize on rising demand, while Florida’s strong economic growth provides additional opportunities to strengthen its regulated utility operations.
This Zacks Rank #3 (Hold) company is well positioned to capitalize on strong residential customer demand. Upward revisions in earnings estimates and a return on equity exceeding the industry average further strengthen its investment prospects.
NextEra Energy’s premium valuation suggests that new investors may benefit from waiting for a more favorable entry point before investing in the stock to capitalize on its long-term growth potential.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.