Is NextEra Energy, Inc. (NYSE:NEE) Expensive For A Reason? A Look At Its Intrinsic Value
Oct 28
U.S. Utilities Sector Analysis
UpdatedOct 30, 2023
DataAggregated Company Financials
Companies138
- 7D0.9%
- 3M-13.1%
- 1Y-14.5%
- YTD-17.4%
The Utilities is pretty flat in the last 7 days, but NextEra Energy has stood out, gaining 11%. As for the longer term, the industry has declined 14% in the last year. Looking forward, earnings are forecast to grow by 9.7% annually.
Sector Valuation and Performance
Has the U.S. Utilities Sector valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE | Absolute PE | PS |
|---|---|---|---|---|---|---|
| Tue, 31 Oct 2023 | US$1.0t | US$550.0b | US$50.3b | 18.9x | 20.4x | 1.9x |
| Thu, 28 Sep 2023 | US$1.0t | US$554.7b | US$51.7b | 18.8x | 20.3x | 1.9x |
| Sat, 26 Aug 2023 | US$1.1t | US$549.7b | US$50.8b | 19.9x | 21.7x | 2x |
| Mon, 24 Jul 2023 | US$1.2t | US$551.7b | US$45.7b | 21.5x | 26.1x | 2.2x |
| Wed, 21 Jun 2023 | US$1.2t | US$551.9b | US$45.7b | 20.4x | 25.2x | 2.1x |
| Fri, 19 May 2023 | US$1.1t | US$549.1b | US$46.5b | 20.4x | 24.6x | 2.1x |
| Sun, 16 Apr 2023 | US$1.2t | US$531.9b | US$45.0b | 21.5x | 26.6x | 2.2x |
| Tue, 14 Mar 2023 | US$1.1t | US$532.0b | US$45.0b | 20.2x | 25x | 2.1x |
| Thu, 09 Feb 2023 | US$1.2t | US$535.5b | US$49.7b | 20.9x | 23.4x | 2.2x |
| Sat, 07 Jan 2023 | US$1.2t | US$531.4b | US$50.1b | 21.5x | 24.4x | 2.3x |
| Mon, 05 Dec 2022 | US$1.2t | US$531.7b | US$45.9b | 21.2x | 26.6x | 2.3x |
| Wed, 02 Nov 2022 | US$1.2t | US$514.3b | US$50.2b | 20.2x | 23.1x | 2.3x |
| Fri, 30 Sep 2022 | US$1.2t | US$505.2b | US$45.1b | 19.7x | 26.5x | 2.4x |
| Sun, 28 Aug 2022 | US$1.3t | US$505.3b | US$45.1b | 22.5x | 28.7x | 2.6x |
| Tue, 26 Jul 2022 | US$1.2t | US$485.6b | US$45.1b | 22.4x | 26.5x | 2.5x |
| Thu, 23 Jun 2022 | US$1.1t | US$484.3b | US$43.7b | 21.6x | 26.2x | 2.4x |
| Sat, 21 May 2022 | US$1.2t | US$484.2b | US$43.7b | 23.6x | 28.2x | 2.5x |
| Mon, 18 Apr 2022 | US$1.3t | US$473.4b | US$40.7b | 25.9x | 32x | 2.8x |
| Wed, 16 Mar 2022 | US$1.2t | US$479.9b | US$41.5b | 23.2x | 29.4x | 2.5x |
| Fri, 11 Feb 2022 | US$1.2t | US$465.6b | US$39.6b | 23.1x | 29.5x | 2.5x |
| Sun, 09 Jan 2022 | US$1.2t | US$443.5b | US$39.3b | 23.7x | 31.3x | 2.8x |
| Tue, 07 Dec 2021 | US$1.2t | US$443.3b | US$39.3b | 22.6x | 30.3x | 2.7x |
| Thu, 04 Nov 2021 | US$1.2t | US$435.6b | US$39.9b | 21.6x | 29.3x | 2.7x |
| Sat, 02 Oct 2021 | US$1.1t | US$429.8b | US$42.1b | 21.3x | 26.3x | 2.6x |
| Mon, 30 Aug 2021 | US$1.2t | US$430.6b | US$42.0b | 22.1x | 27.8x | 2.7x |
| Tue, 06 Jul 2021 | US$1.1t | US$430.0b | US$42.1b | 21.5x | 25.9x | 2.5x |
| Fri, 09 Apr 2021 | US$1.1t | US$418.5b | US$40.8b | 21.7x | 26.9x | 2.6x |
| Thu, 31 Dec 2020 | US$1.1t | US$399.8b | US$35.9b | 20.8x | 29.6x | 2.7x |
Price to Earnings Ratio
28.8x
Current Industry PE
- Investors are pessimistic on the American Utilities industry, indicating that they anticipate long term growth rates will be lower than they have historically.
- The industry is trading at a PE ratio of 20.2x which is lower than its 3-year average PE of 26.9x.
- The 3-year average PS ratio of 2.4x is higher than the industry's current PS ratio of 1.9x.
Past Earnings Growth
- The earnings for companies in the Utilities industry have grown 12% per year over the last three years.
- Revenues for these companies have grown 11% per year.
- This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.
Industry Trends
Which industries have driven the changes within the U.S. Utilities sector?
| US Market | -2.42% | |
| Utilities | 0.86% | |
| Renewable Energy | 2.31% | |
| Electric Utilities | 1.33% | |
| Water Utilities | 0.84% | |
| Other Utilities | 0.19% | |
| Gas Utilities | -2.44% | |
Industry PE
- Investors are most optimistic about the Gas Utilities industry which is trading above its 3-year average PE ratio of 23.9x.
- Analysts are expecting annual earnings growth of 14.5%, which is higher than its past year's earnings growth of 11.5% per year.
- Investors are most pessimistic about the Other Utilities industry, which is trading below its 3-year average of 26.4x.
Forecasted Growth
- Analysts are most optimistic on the Renewable Energy industry, expecting annual earnings growth of 21% over the next 5 years.
- This is better than its past earnings decline of 64% per year.
- In contrast, the Other Utilities industry is expected to see its earnings grow by 7.1% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | |
|---|---|---|---|---|---|
| NEE NextEra Energy | US$57.20 | 11.0% +US$11.5b | -26.2% | PE15.2x | |
| SO Southern | US$66.79 | 2.1% +US$1.5b | 2.0% | PE23.6x | |
| DUK Duke Energy | US$87.90 | 1.8% +US$1.2b | -5.7% | PE18.2x | |
| AEP American Electric Power Company | US$75.41 | 2.8% +US$1.1b | -14.2% | PE19.6x | |
| PCG PG&E | US$16.20 | 2.9% +US$918.1m | 8.5% | PE17.6x |
