- Price
- $79.80
- Fair value
- $88.00
- Discount
- 9.3%
- Uncertainty
- Medium
- LSEG rating
- 2.18
- Moat
- Narrow
- Next earnings
- 2026-10-21
- Next earnings is estimate
- No
- Company name
- NextEra Energy
- Sector
- Electric utilities & renewable energy
- About
- NextEra Energy has two main businesses. Florida Power & Light (FPL) is a regulated electric utility that serves most of Florida, and it adds more than 90,000 customers a year. NextEra Energy Resources builds and operates wind, solar, battery storage, natural gas and nuclear plants, and it sells most of the power under long-term contracts. It also owns electric transmission lines through NextEra Energy Transmission. NextEra Energy Resources had a backlog of about 35.1 gigawatts of new renewables and storage projects at July 2026, and it plans to restart the Duane Arnold nuclear plant in Iowa no later than Q1 2029. On May 18, 2026, NextEra Energy agreed to combine with Dominion Energy, the utility for parts of Virginia, North Carolina and South Carolina.
- Thesis
- The market prices NextEra Energy for the cost and the risk of its combination with Dominion Energy. Dominion Energy shareholders will get 0.8138 NextEra Energy shares and a share of $360 million in cash for each Dominion share, and they will own about 25.5% of the combined company. The deal needs approvals from the utility commissions of Virginia, North Carolina and South Carolina, the Federal Energy Regulatory Commission (FERC), the Nuclear Regulatory Commission (NRC) and the antitrust agencies. To win support in Virginia, the companies doubled the residential bill credits from two years to four years in September 2026. If the deal fails in some cases, NextEra Energy must pay a termination fee of $4.8 billion or $6.5 billion. The company also carries large debt: $110 billion at June 30, 2026, up from $96 billion at the end of 2025, to fund about $12 billion to $13 billion of FPL capital spending a year and its renewables backlog. For the gap to close, three things must be true. The state commissions and FERC must approve the deal without conditions that remove its value, within the 12 to 18 months from May 2026 that the companies expect. Adjusted EPS must keep growing at the target rate of 8% or more a year through 2032, as it did with 9.5% growth in Q2 2026. FPL must sign at least one large-load contract, such as a data center, by the end of 2026, as it expects. The Q3 2026 report on October 21, 2026 gives the next test. The regulatory decisions through 2027 are the main tests. If they pass, the gap can close over the next four to six quarters. The main reason it may not close is a Virginia approval with large customer concessions, which reduces the value of the deal for shareholders.
- Risks
- The Dominion Energy combination needs approvals from three state commissions, FERC, the NRC and the antitrust agencies. Regulators can ask for more customer benefits or other conditions. If the deal ends in some cases, NextEra Energy must pay a fee of $4.8 billion or $6.5 billion.
Debt rose to about $110 billion at June 30, 2026. Higher interest rates increase the cost of new debt and of refinancing, and make utility shares less attractive against bonds.
NextEra Energy Resources depends on long-term contracts, supply chains and federal energy policy. Changes in tax credits, tariffs on equipment or delays in grid connections can slow new projects and reduce returns.
FPL's rates and returns are set by the Florida Public Service Commission. Hurricanes can damage the grid and cause large storm costs, which FPL must recover through rates.
- Balance sheet
- Cash: $2.9B
Debt: $110.2B
Net debt: $107.3B
Interest cover: 2.5×
Undrawn credit line: $18.1B
NextEra Energy funds its large capital program with debt at FPL and at NextEra Energy Capital Holdings (NEECH), which funds the non-utility businesses. At June 30, 2026, total debt was $110.2 billion: long-term debt of $98.8 billion, current maturities of $5.4 billion, commercial paper of $1.7 billion and other short-term debt of $4.3 billion. FPL's own long-term debt was $30.2 billion. Cash was $2.87 billion. Net available liquidity from credit facilities was about $18.1 billion, and the syndicated facilities mature from 2027 to 2031. In June 2026, NEECH sold $3.75 billion of junior subordinated debentures. Interest cover is operating income divided by interest expense for the first half of 2026, and interest expense includes gains and losses on interest rate hedges. The Dominion Energy combination is mostly in shares, so it adds Dominion's debt but needs little new debt for the purchase.
As of 2026-06-30.
- Checkpoints
- Oct 21, 2026: Q3 2026 results: EPS growth and large-load contracts. Pending. Watch: Adjusted EPS growth of 8% or more and progress toward an FPL large-load contract pass; slower EPS growth or no progress on large loads fails.
Q2 2027 (estimate): State approvals of the Dominion Energy combination. Pending. Watch: Approvals from the Virginia, North Carolina and South Carolina commissions with conditions near the announced benefits pass; a rejection or large new conditions fail.
- Recent events
- 2026-09-22: A Florida court set a hearing for December 14, 2026 to decide whether to approve a proposed settlement of a shareholder derivative lawsuit, Davidson v. Silagy, and related actions.
2026-09-14: NextEra Energy and Dominion Energy announced a larger benefits package for Virginia. It doubles the residential bill credits from two years to four years, adds $100 million to Dominion's EnergyShare bill assistance program through 2038, keeps Virginia jobs for five years, adds 1,000 new jobs and holds customers harmless from merger costs.
2026-09-03: NextEra Energy shareholders approved the issue of NextEra Energy shares to Dominion Energy shareholders in the combination, at a special meeting.
2026-07-24: NextEra Energy reported Q2 2026 results. Net income was $3.144 billion, or $1.50 per share. Adjusted EPS rose 9.5% to $1.15. FPL net income rose to $1.412 billion, and its regulatory capital employed grew about 9.3%. NextEra Energy Resources added 3.6 gigawatts to its backlog. FPL has about 21 gigawatts of large-load interest and is in advanced talks on 12 gigawatts. The companies filed for merger approvals with state and federal agencies in July 2026.
2026-06-22: NextEra Energy Capital Holdings sold $3.75 billion of junior subordinated debentures due 2056 and 2066, with initial interest rates of 6.000% to 6.625%.
2026-05-18: NextEra Energy and Dominion Energy agreed to combine in a mostly stock deal. The combined company will serve about 10 million utility customer accounts in Florida, Virginia, North Carolina and South Carolina and will be more than 80% regulated. It proposes $2.25 billion of bill credits for Dominion customers and targets adjusted EPS growth of 9% or more a year through 2032. The companies expect the deal to close in 12 to 18 months. On the same day, Scott Bores became CEO of FPL, and Armando Pimentel became Vice Chairman of NextEra Energy.