NEE
NextEra Energy, Inc.
Utilities · Utilities - Regulated Electric · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- Strong revenue growth and wide margins supported the growth and profitability factors, but the simultaneous decline in net income and EPS capped the growth score at a middling level.
- Quarterly momentum was assessed as mixed rather than sustained, given the non-linear pattern with a notable 2025Q4 dip and only partial recovery in 2026Q1.
- The macro theme alignment with Grid-Scale Battery Storage, Grid Modernization, and Renewable Energy Generation did not translate into score under the current model, which weighed on the composite total of 53.7 out of 100.
Why Not Higher
- The theme factor scored zero despite three high-profile macro theme assignments, and the dividend factor was constrained by the elevated 68.5% payout ratio, both of which held back the composite score.
- Bottom-line contraction — net income down -1.6% and diluted EPS down -2.1% in FY2025 — alongside volatile quarterly earnings prevented the growth and momentum factors from reaching their upper ranges.
Data Confidence
8 / 10
High — most data fields present
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew from FY2024's $24,753,000,000 to FY2025's $27,412,000,000, a gain of +10.7%, but net income declined -1.6% from FY2024's $6,946,000,000 to FY2025's $6,835,000,000, and diluted EPS fell -2.1% from FY2024's $3.37 to FY2025's $3.30.
The model rewarded meaningful top-line expansion but penalized the simultaneous contraction in bottom-line earnings and per-share profitability, producing a middling score that reflects this mixed growth profile.
In FY2025, NextEra posted an operating margin of 30.2% and a net margin of 24.9%, while return on assets came in at 3.2%.
The model rewarded the company's wide operating and net margins, which indicate strong earnings conversion from revenue, while the relatively modest return on assets — reflecting the capital-intensive nature of the utility business — tempered the score below the maximum.
Filing evidence currently available does not support a more specific explanation for this factor.
Over the last four reported quarters, revenue ranged from $6,499,000,000 in 2025Q4 to $7,966,000,000 in 2025Q3, with 2026Q1 at $6,701,000,000; net income moved from $2,028,000,000 in 2025Q2 to a peak of $2,438,000,000 in 2025Q3, dipped to $1,536,000,000 in 2025Q4, then recovered to $2,182,000,000 in 2026Q1; operating income followed a similar pattern, peaking at $2,527,000,000 in 2025Q3 before falling to $1,586,000,000 in 2025Q4 and rebounding to $2,208,000,000 in 2026Q1.
The quarterly data show a volatile, non-linear trend with a notable mid-sequence trough in 2025Q4 followed by partial recovery, which the model interpreted as mixed momentum rather than sustained acceleration, supporting a near-midpoint score.
Dividends per share have risen each year from FY2022's $1.70 to FY2023's $1.87, FY2024's $2.06, and FY2025's $2.27, while the FY2025 dividend payout ratio stood at 68.5%.
The model recognized a consistent multi-year dividend growth trend as a positive signal, but the elevated payout ratio of 68.5% in FY2025 — indicating that a large share of net income is being returned to shareholders — likely constrained the score by raising questions about long-term dividend sustainability relative to earnings coverage.
NextEra Energy is assigned to the macro themes of Grid-Scale Battery Storage, Grid Modernization, and Renewable Energy Generation.
Although the company carries three high-profile macro theme assignments, this alignment did not translate into score under the model's current methodology for this factor.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
NextEra Energy posted solid top-line growth of +10.7% in FY2025, with revenue rising to $27,412,000,000, but bottom-line results were mixed as net income slipped -1.6% to $6,835,000,000 and diluted EPS fell -2.1% to $3.30. The company maintains wide operating and net margins of 30.2% and 24.9% respectively, reflecting strong earnings conversion, though its capital-intensive asset base of $212,721,000,000 in total assets yields a modest 3.2% return on assets. Quarterly momentum has been volatile, with a notable trough in 2025Q4 followed by partial recovery in 2026Q1, and a consistent multi-year dividend growth trend is tempered by an elevated 68.5% payout ratio. The company's alignment with high-profile macro themes — Grid-Scale Battery Storage, Grid Modernization, and Renewable Energy Generation — did not contribute to the composite score under the current model methodology.
Plain English
NextEra is bringing in more revenue each year and pays a growing dividend, but its profits per share are actually slipping slightly, its quarterly earnings have been bumpy, and a large chunk of its income already goes back to shareholders as dividends, which together give it a middling overall score.
Bull Case vs. Bear Case
Bull Case
- Revenue grew meaningfully, rising +10.7% year-over-year to $27,412,000,000 in FY2025, demonstrating the company's ability to expand its top line at scale.
- Wide operating and net margins of 30.2% and 24.9% in FY2025 indicate that NextEra converts a substantial portion of its revenue into earnings, a hallmark of operational efficiency.
- Dividends per share have grown every year from $1.70 in FY2022 to $2.27 in FY2025, reflecting a consistent multi-year commitment to returning capital to shareholders.
Bear Case
- Despite strong revenue growth, net income declined -1.6% and diluted EPS fell -2.1% in FY2025, signaling that bottom-line profitability is not keeping pace with top-line expansion.
- The FY2025 dividend payout ratio of 68.5% is elevated, meaning a large share of net income is already committed to dividends, which raises questions about long-term sustainability if earnings growth remains under pressure.
- Quarterly results have been volatile, with net income dropping to $1,536,000,000 in 2025Q4 before partially recovering to $2,182,000,000 in 2026Q1, suggesting inconsistent near-term earnings momentum.
What Could Change the Picture
Bullish Triggers
- A sustained recovery in quarterly net income and operating income above the 2025Q3 peak of $2,438,000,000 and $2,527,000,000 respectively would signal that the 2025Q4 trough was temporary and that earnings momentum is genuinely accelerating.
- If the payout ratio declines meaningfully from its current 68.5% level — indicating that earnings growth is outpacing dividend increases — it would reduce concerns about dividend sustainability and strengthen the overall financial profile.
Bearish Triggers
- A further widening of the gap between revenue growth and net income growth — beyond the current divergence of +10.7% revenue versus -1.6% net income — would suggest structural margin compression that could weigh on long-term value.
- If quarterly volatility deepens and the 2025Q4 trough of $1,536,000,000 in net income becomes a recurring pattern rather than an anomaly, confidence in the company's earnings stability would erode further.
Risk Profile
Medium RiskNextEra's total asset base of $212,721,000,000 underscores the capital-intensive nature of its business, which contributes to a relatively modest 3.2% return on assets and limits financial flexibility. Quarterly earnings have shown meaningful volatility, with operating income swinging from a peak of $2,527,000,000 in 2025Q3 to a trough of $1,586,000,000 in 2025Q4, introducing uncertainty around near-term earnings consistency.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.