NextEra Energy NEE is scheduled to release its second-quarter 2026 results on July 24, before market open. The Zacks Consensus Estimate for earnings is currently pegged at $1.08 per share on revenues of $7.97 billion.
Second-quarter earnings estimates have remained unchanged over the past 60 days. The Zacks Consensus Estimate for quarterly revenues indicates a year-over-year increase of 18.92%.
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NEE Stock’s Earnings Surprise History
NextEra Energy’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 6.18%.
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What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for NextEra Energy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you can see below.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
NEE’s Earnings ESP: NextEra Energy has an Earnings ESP of -0.47%.
Zacks Rank of NEE: The company currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Some companies in the same industry with the right combination of the two factors for an earnings beat this season are Edison International EIX, Duke Energy DUK and PPL Corporation PPL. EIX, DUK and PPL currently have an Earnings ESP of +20.45%, +0.08% and +4.23%, respectively. EIX and DUK carry a Zacks Rank #2 each, while PPL has a Zacks Rank #3.
Factors Likely to Have Boosted NEE Stock’s Q2 Results
NextEra Energy’s subsidiary, Florida Power & Light (“FPL”), continues to capitalize on Florida’s robust economic growth, driving consistent customer additions. Strategic investments in grid infrastructure support reliable service while keeping electricity rates about 25% below the national average. Competitive pricing and the ongoing shift toward renewable energy are improving customer retention and reducing fuel expenses, supporting long-term earnings growth. Improving electricity demand from this region is expected to have a positive impact on earnings.
NextEra Energy’s other unit, Energy Resources, is benefiting from the new additions to its renewables and storage portfolio. After placing 0.7 gigawatts (GWs) of new projects into service during the first quarter, its backlog stood at nearly 28 GWs. Energy Resources' second-quarter earnings are expected to benefit from the addition of new renewable generation in its portfolio.
Strategic investment in its infrastructure and strong demand from AI and data centers operating in the service region will continue to drive NextEra Energy's performance. New projects placed into service are likely to have contributed to second-quarter earnings.
However, developing natural gas projects has become costly compared with renewable and battery storage and at times, procuring gas turbines for natural gas projects becomes difficult for the company, which can escalate operating costs and adversely impact earnings per share.
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 company's current ROE indicates that it is using shareholders’ funds more efficiently than peers.
NextEra Energy’s trailing 12-month ROE is 12.25%, ahead of the industry average of 11.21%.
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NEE Stock’s Price Performance
NEE’s shares have gained 16.6% in the past year compared with the Zacks Utility – Electric Power industry’s rise of 16.5%.
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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 trading at 21.12X compared with its industry’s 15.4X.
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Investment Thesis
Florida’s improving economic conditions are driving higher electricity demand and supporting steady customer growth for NextEra Energy. Continued investments in renewable energy and battery storage are further enhancing its ability to provide reliable and sustainable power.
Through disciplined cost control, the company keeps utility bills significantly below the national average, improving affordability and helping attract additional customers. Demand from data centers is going to create fresh opportunities for the company.
Although the company’s ROE is better than the industry, its premium valuation and costly natural gas projects compared with renewables are a concern.
Wrapping Up
Although NextEra Energy’s second-quarter earnings are likely to come in below estimates, its long-term outlook remains solid. Ongoing investments in renewable energy and Florida’s robust economic expansion continue to create new growth opportunities.
With increasing power demand and a steadily expanding customer base, the company is well positioned to deliver sustainable growth, making the stock an appealing investment at current valuations.
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NextEra Energy, Inc. (NEE): Free Stock Analysis Report
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Duke Energy Corporation (DUK): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).