Question

a summary about NextEra energy stock.

what is it?

why is it s successful company

what are the risks and opportunities

Answer 1

Summary About NextEra Energy Stock and What is it ?

NextEra Energy, Inc. is an electric power and energy infrastructure company. Basically It operates through the following segments: FPL & NEER.  The company was founded in 1984 and is headquartered in Juno Beach, FL

The FPL segment engages primarily in the generation, transmission, distribution and sale of electric energy in Florida.

The NEER segment produces electricity from clean and renewable sources, including wind and solar. It also provides full energy and capacity requirements services; engages in power and gas marketing and trading activities; participates in natural gas production and pipeline infrastructure development; and owns a retail electricity provider. .

Reason Why NextEra is sucessful Company

- Company has shown tremendous growth over the period of life.

- Today the company's share is trading near about $275.

- The company has given 10x return in last 10 years. That mean $1 lakh invested 10 years back has become $10 Lakh i.e.. 1000% return.

- Company has good corporate governance.

RISKS

- NextEra Energy does have debt that is over $42 billion in debt, but mazor portion of the same is long term debt and should not be a huge issue for a company that makes nearly $20 in revenues each year. This number should be watched carefully if markets take a long-term downward trend though.

- Due to Covid 19 the stock has shown little correction.

- The biggest hit that we could see from this would be less investment in renewables in turn slowing growth, but we do not really expect to see this happening unless the virus drags on much longer than anticipated.

- As looking at the current situation we can expect tremendous growth once again but as everyone knows that there is always Uncertainty in this market. that is the reason we cannot give absolute assurance for the same.

OPPORTUNITIES

- NextEra Energy has been a growth leader among competitors for some time now, One can also expect the same in coming years too.

- This growth is coming primarily from contributions from new projects. Management of the company is doing well. We can see more project in future also.

- NextEra Expects To Grow EPS Well Beyond That Of Competitors Over The Next Couple Of Years

- Earlier the stock was overvalued, But due to the coronavirus, the stock now trades valued relatively fairly. With the growth that is expected it is not impractical to assume that the stock could return to 52 week highs by the end of 2020 with no problems signaling a short-term upside of as much as 50% returns to the $280 area.

- For patient investors willing to take on more risk it could pay to hold through 2021 as well with EPS numbers pushing higher the stock could potentially test high.