NextEra Energy, Inc. (NYSE:NEE)

CAPS Rating: 4 out of 5

The Company is a provider of electricity-related services. Its principal subsidiary, FPL, is a rate-regulated utility engaged primarily in the generation, transmission, distribution and sale of electric energy.

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Member Avatar georgecass (70.79) Submitted: 10/13/2014 10:39:50 PM : Outperform Start Price: $93.07 NEE Score: -0.37

great company . well positioned

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Member Avatar a410traveler (36.38) Submitted: 8/29/2014 6:57:59 PM : Outperform Start Price: $98.29 NEE Score: +0.62

The best utility in the country. Everything else is fool's gold in comparison

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Member Avatar btukwh (30.29) Submitted: 6/25/2014 8:06:46 PM : Outperform Start Price: $97.34 NEE Score: -1.46

I believe NEE to be the most forward thinking of the utilities. Hopefully will benefit from CO2 regs.

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Member Avatar TMFDeej (99.27) Submitted: 6/10/2014 3:32:09 PM : Outperform Start Price: $95.01 NEE Score: +1.26

Regulatory issues prevent regulated utilities, like power companies, from forming MLPs or REITs for their assets. As a result, many of these companies have turned to a third type of high-distribution-paying type of corporate entity, the "Yield Co.," (I've also seen it written "YieldCo without a space) to spinoff assets with predictable cash flow. Yield Cos have become particularly popular with companies that have existing renewable energy assets, such as solar, wind and thermal power generation plants, that they wish to monetize and use as a cheaper source of funds.

The reason renewable energy assets are put into Yield Cos by utilities is that they enable Yield Cos. to use government tax credits on the renewable energy generation assets to create a "synthetic MLP" that pay very little or no taxes, even often when combined with some conventional power generation assets.

The NRG Energy (NRG) spun off certain assets in NRG Yield (NYLD) last summer. Its share offering was so popular that it was more than 10 times over-subscribed. The IPO opened at $22/share with a distribution yield of 5.45%. By the end of the year, NRG Yield's shares had soared more than 64%.

In the near future, Sun Edison (SUNE) and Abengoa (AGBG) are scheduled to spinoff yield cos. I am already long both companies in CAPS and in real life.

The next Yield Co. creator may be the power company formerly known as Florida Power & Light (FPL)...that's what it was called back when I owned shares of it. Today FPL calls itself NextEra Energy (NEE). As the country's largest solar and wind operator it is a natural to form a Yield Co. After mulling over the idea for nearly a year, NEE has decided to move forward with the creation of one.

While NEE's stock has performed very well lately, likely at least in part in response to investor anticipation of the YieldCo creation. I still believe that the creation of one will likely result in further upside for the company's stock when its details are officially announced.

This may not be the last creation of a Yield Co. either. According to Moody’s, as many as 30 utilities around the world have the ability to create a YieldCo right now. SunPower (SPWR) may get in on the action as well.

Jason

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Member Avatar afewgoodstocks11 (26.04) Submitted: 11/27/2013 1:09:33 PM : Outperform Start Price: $49.55 NEE Score: +31.36

Some of these 2011 picks are really starting to compound dividend. I wish i could get my broker to do it this way. lol

Div. (Yield) $2.64 (3.1%)
Current Yield 5.20%

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Member Avatar ValueSpreadsheet (< 20) Submitted: 7/27/2013 8:24:41 AM : Underperform Start Price: $80.90 NEE Score: -3.01

Be very careful with NextEra Energy!

Over the past four years, NEE has reported the following earnings:

2012 2011 2010 2009
$4.37   $4.68   $4.68   $3.96

At first glance, this seems like a stable company. However, in those same years, FCF has been steadily declining:

2012 2011 2010 2009
-$2.07   $0.11   $2.11   $3.69

This is unsustainable in the long run. In addition, the Altman Z score of NEE is 1.26, implying NEE has an increased probability to go bankrupt within two years time. Also, the company has piles of deb and a current ratio of only 0.46, which means that NEE is unable to meet its short term obligations.

Finally, the DCF model of Value Spreadsheet assigns NEE an intrinsic value of $2 (!!), while the score assigned to the fundamentals of the company are a mere 34 (out of 100).

I suggest you avoid NEE as the plague, because this can get ugly.

Nick
http://www.valuespreadsheet.com

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Member Avatar cooleyly (68.17) Submitted: 7/5/2013 7:09:52 PM : Outperform Start Price: $76.97 NEE Score: +5.66

wind and solar power are in favor, 5 stars in CAPS today

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Member Avatar JMacSol (68.50) Submitted: 4/25/2013 2:34:02 PM : Outperform Start Price: $76.73 NEE Score: +2.43

Solid fundamentals in a slow growth industry. Dividend will continue to attract investors so long as interest rates remain low.

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Member Avatar schreff (< 20) Submitted: 10/2/2012 3:22:37 PM : Underperform Start Price: $65.87 NEE Score: -10.37

~50% of it's capital is in solar and the ROI is only ~23%. Even Europe has slowed down on solar after the government subsidies went away.

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Member Avatar maazzoo69 (87.91) Submitted: 9/28/2012 8:45:34 PM : Outperform Start Price: $66.22 NEE Score: +9.97

I like the sound of this: Both FPL and NEER are known for their clean and/or renewable energy sources, including wind, hydro, and a bit of solar to boot.

Link: http://www.fool.com/investing/general/2012/09/25/1-dividend-stock-with-growth-potential.aspx

Thanks for recommending Justin Loiseau

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Member Avatar TMFJLo (92.64) Submitted: 9/25/2012 4:41:11 PM : Outperform Start Price: $62.95 NEE Score: +14.21

Read my full bull call here: http://www.fool.com/investing/general/2012/09/25/1-dividend-stock-with-growth-potential.aspx

As one of the largest electricity companies around, NextEra occupies an interesting spot at the nexus of income and growth. For income investors, its 3.5% annual dividend yield is nothing to yawn at. As a growth investor, NextEra's dividend offers income today for big rewards tomorrow.

NextEra enjoys a fair amount of diversity due to its regulated and unregulated divisions, but the real risk reduction secret sauce of this company lies in its energy sources. Both FPL and NEER are known for their clean and/or renewable energy sources, including wind, hydro, and a bit of solar to boot.

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Member Avatar Distressedstar (< 20) Submitted: 9/25/2012 12:47:29 AM : Outperform Start Price: $65.22 NEE Score: +13.49

0.6

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Member Avatar aria70 (< 20) Submitted: 5/7/2012 12:58:20 PM : Outperform Start Price: $58.96 NEE Score: +20.59

Great company well managed
increasing dividend and stock performance
ahead of its peers

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Member Avatar limanova (< 20) Submitted: 11/9/2011 5:08:42 AM : Outperform Start Price: $50.27 NEE Score: +34.61

Broadening judiciously into other energy sources, like high efficiency concentrated solar, while delivering good service at reasonable costs.

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Member Avatar Wifeb123 (61.91) Submitted: 8/12/2011 1:05:51 PM : Outperform Start Price: $47.25 NEE Score: +38.46

leader in green energy generation

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Member Avatar Stan1955 (59.64) Submitted: 8/6/2011 3:07:11 PM : Outperform Start Price: $46.76 NEE Score: +39.27

Great zap power good dividend.

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Member Avatar concealedweaponR (< 20) Submitted: 6/6/2011 4:04:07 PM : Outperform Start Price: $49.27 NEE Score: +44.25

This one impresses me because they are set as a current money generator and also set up to make head way in future cleaner energy

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Member Avatar Ernten (< 20) Submitted: 4/15/2011 11:28:14 AM : Outperform Start Price: $48.54 NEE Score: +49.71

Stock with Low Payout Ratio and High Yield

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Member Avatar PebbledShore (87.46) Submitted: 3/31/2011 11:30:07 AM : Outperform Start Price: $48.26 NEE Score: +51.51

Filling out my CAPS player with highly-ranked dividend payers.

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Member Avatar DavenTenn (< 20) Submitted: 10/26/2010 4:37:43 PM : Underperform Start Price: $47.33 NEE Score: -37.20

Lower than average utility dividend, dependent on govt. subsidies for wind power development. A dysfuntional company with many internal issues. Good vision for the future but may be unable to be "in the game". Lowest kw/hr rate in Florida but has a aging work force with no internal development. Employee trust issues, multiple PSC confrontations, FDLE investigating whistle blower complaints. Hurricane exposure without "hardened infrastructure" in place. Good CEO with a knack for delivering a good message at the right time. Stock will outperform near term with a skitterish economy but will fade as the growth of the utility industry becomes more organic, and moves towards modernization and alternative/nuclear power.

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