NextEra Energy (NEE +0.93%) isn't your average utility. It has grown its adjusted earnings per share at a 10% compound annual rate over the last decade, more than four times faster than the average utility (2.2%). Several factors have fueled its robust growth rate, including operating the largest electric utility in Florida and focusing on developing clean energy infrastructure.
The company's growth engine was running at full power during the first quarter. Here's a look at those numbers and what the leading energy stock sees ahead.
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Off to a terrific start
NextEra Energy is "off to a terrific start for the year, delivering strong first-quarter results," stated CEO John Ketchum in the first-quarter earnings press release. The energy company generated $2.3 billion, or $1.09 per share, in adjusted earnings in the first quarter, up 10% year over year. Both of its businesses performed well during the quarter.
The company's electric utility in Florida, FPL, reported nearly $1.5 billion in net income, or $0.70 per share, up more than 9% from last year. FPL added almost 100,000 new customers over the past year, benefiting from Florida's rapid growth. That's enabling it to invest in growing its generation portfolio, which included adding about 600 megawatts (MW) of solar energy capacity in the quarter, boosting its portfolio to over 8.5 gigawatts (GW).
Meanwhile, NextEra Energy Resources reported adjusted net income of over $1 billion, or $0.50 per share, up nearly 14% from last year. It continues to benefit from building out additional clean energy infrastructure to support the power demand of other utilities and large corporate customers.
NYSE: NEE
Key Data Points
The powerful growth should continue
NextEra Energy also continues to make excellent progress on its growth strategy. FPL filed its annual 10-year site plan, which includes building 4 GW of new gas-fired power generation, over 12 GW of solar, and more than 7 GW of storage solutions over the next decade.
Meanwhile, the energy resources segment had a record quarter, with 4 GW in new renewable and storage project originations. The company is also off to a strong start on its data center hub strategy. The U.S. Department of Commerce selected it to build 9.5 GW of gas-fired power projects to support large electricity loads in Texas and Pennsylvania. The company is working toward securing 40 hubs by the end of this year.
These projects support NextEra's long-term earnings growth expectations. The company anticipates delivering earnings-per-share growth of more than 8% annually through 2035. That should support 6% annual dividend growth through at least 2028, driving its 2.7%-yielding payout even higher.
High-powered total return potential
NextEra Energy expects to grow briskly over the next decade as it supports surging electricity demand across the U.S. That positions it to generate robust total returns (dividend income plus price appreciation). The company's high return potential makes it a great energy stock to buy and hold to capitalize on the country's power boom.
