NextEra Energy board declares quarterly dividend and continues above-average targeted growth rate in dividends per share through at least 2026

Rhea-AI Summary

NextEra Energy, Inc. (NEE) declared a 10% increase in its quarterly common stock dividend to $0.515 per share, continuing its plan for 10% annual growth in dividends through 2026. The company's strong financial performance and dividend policy reflect its commitment to shareholder value and sustainable growth.

Insights

Financial Analyst

The announcement by NextEra Energy, Inc. of a 10% increase in its quarterly common stock dividend represents a positive signal to shareholders, reflecting the company's financial health and commitment to returning value. The increase aligns with the previously communicated growth targets, suggesting a disciplined approach to financial planning. The forward-looking dividend policy indicates confidence in the company's ability to sustain earnings and cash flow growth, which is critical for investors seeking stable, long-term returns.

NextEra Energy's payout ratio of 59% is notably lower than the industry average, which suggests conservative financial management and potential for future dividend increases. This, coupled with the company’s position in the clean energy sector—a market with growing demand—positions NextEra Energy favorably in terms of investment attractiveness. Investors should, however, monitor the company's ability to maintain its strong balance sheet and credit ratings while pursuing growth.

Market Research Analyst

NextEra Energy's strategic focus on clean energy aligns with broader market trends towards sustainability and renewable energy sources. As the world's largest generator of renewable energy, the company is well-positioned to capitalize on the increasing global demand for clean energy solutions. This strategic positioning is likely to bolster investor confidence and could contribute to the company's above-average dividend growth.

Analyzing the competitive landscape, NextEra Energy's operational scale and commitment to clean, affordable and reliable electricity provision in a high-demand market like Florida enhances its competitive moat. The company's ongoing efforts in sustainability and corporate responsibility further enhance its reputation and may attract socially conscious investors, potentially impacting stock valuation positively.

Energy Sector Analyst

The energy sector is undergoing a significant transformation, with renewable energy sources becoming increasingly cost-competitive against traditional fossil fuels. NextEra Energy's investment in renewable energy generation and battery storage positions it at the forefront of this transition. The company's ability to maintain a lower payout ratio while committing to dividend growth reflects operational efficiency and a strong market position within the clean energy sector.

Investors should consider the regulatory environment, which can significantly impact the renewable energy industry. NextEra Energy's proactive approach to growth and its focus on maintaining strong financial metrics are indicative of a robust strategy to navigate potential regulatory changes. The company's expansion in renewable energy and storage, along with its nuclear power assets, diversifies its portfolio, mitigating risks associated with market volatility and regulatory shifts.

JUNO BEACH, Fla., Feb. 16, 2024 /PRNewswire/ -- The board of directors of NextEra Energy, Inc. (NYSE: NEE) declared a regular quarterly common stock dividend of $0.515 per share, an approximate 10% increase versus the prior-year comparable quarterly dividend. This increase is consistent with the plan announced in 2022 of targeting roughly 10% annual growth in dividends per share through at least 2024, off a 2022 base. The dividend is payable on March 15, 2024, to shareholders of record on Feb. 27, 2024.

The board also approved an updated dividend policy beyond 2024, which is expected to translate to a growth rate in dividends per share of roughly 10% per year through at least 2026, off a 2024 base, which is expected to be $2.06 per share.

"The board's approval to continue to grow our dividends per share in excess of our expected adjusted earnings per share growth rate is a result of our success in executing on our industry-leading business strategy," said John Ketchum, chairman, president and chief executive officer of NextEra Energy. "With a 59% payout ratio at the end of 2023, below the peer average of approximately 65%, and the continued strength of the earnings and operating cash flow growth at NextEra Energy, we remain well positioned to support the dividend policy going forward. I believe we continue to offer a best-in-class total return potential, with above-average dividend growth and clear visibility to deliver financial results at or near the top end of our adjusted earnings per share expectations ranges in each year through 2026, while maintaining our strong balance sheet and credit ratings."

NextEra Energy, Inc.

NextEra Energy, Inc. (NYSE: NEE) is a leading clean energy company headquartered in Juno Beach, Florida. NextEra Energy owns Florida Power & Light Company, which is America's largest electric utility that sells more power than any other utility, providing clean, affordable, reliable electricity to approximately 5.9 million customer accounts, or more than 12 million people across Florida. NextEra Energy also owns a competitive clean energy business, NextEra Energy Resources, LLC, which, together with its affiliated entities, is the world's largest generator of renewable energy from the wind and sun and a world leader in battery storage. Through its subsidiaries, NextEra Energy generates clean, emissions-free electricity from seven commercial nuclear power units in Florida, New Hampshire and Wisconsin. A Fortune 200 company, NextEra Energy has been recognized often by third parties for its efforts in sustainability, corporate responsibility, ethics and compliance, and diversity. For more information about NextEra Energy companies, visit these websites: www.NextEraEnergy.com, www.FPL.com, www.NextEraEnergyResources.com.

Cautionary Statements and Risk Factors That May Affect Future Results

This news release contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are not statements of historical facts, but instead represent the current expectations of NextEra Energy, Inc. (together with its subsidiaries, NextEra Energy) regarding future operating results and other future events, many of which, by their nature, are inherently uncertain and outside of NextEra Energy's control.  Forward-looking statements in this news release include, among others, statements concerning future dividends. In some cases, you can identify the forward-looking statements by words or phrases such as "will," "may result," "expect," "anticipate," "believe," "intend," "plan," "seek," "potential," "projection," "forecast," "predict," "goals," "target," "outlook," "should," "would" or similar words or expressions.  You should not place undue reliance on these forward-looking statements, which are not a guarantee of future performance.  The future results of NextEra Energy and its business and financial condition are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, or may require it to limit or eliminate certain operations.  These risks and uncertainties include, but are not limited to, those discussed in this news release and the following: effects of extensive regulation of NextEra Energy's business operations; inability of NextEra Energy to recover in a timely manner any significant amount of costs, a return on certain assets or a reasonable return on invested capital through base rates, cost recovery clauses, other regulatory mechanisms or otherwise; impact of political, regulatory, operational and economic factors on regulatory decisions important to NextEra Energy; disallowance of cost recovery based on a finding of imprudent use of derivative instruments; effect of any reductions or modifications to, or elimination of, governmental incentives or policies that support utility scale renewable energy projects or the imposition of additional tax laws, tariffs, duties, policies or assessments on renewable energy or equipment necessary to generate it or deliver it; impact of new or revised laws, regulations, interpretations or constitutional ballot and regulatory initiatives on NextEra Energy; capital expenditures, increased operating costs and various liabilities attributable to environmental laws, regulations and other standards applicable to NextEra Energy; effects on NextEra Energy of federal or state laws or regulations mandating new or additional limits on the production of greenhouse gas emissions; exposure of NextEra Energy to significant and increasing compliance costs and substantial monetary penalties and other sanctions as a result of extensive federal regulation of its operations and businesses; effect on NextEra Energy of changes in tax laws, guidance or policies as well as in judgments and estimates used to determine tax-related asset and liability amounts; impact on NextEra Energy of adverse results of litigation; impacts of NextEra Energy of allegations of violations of law; effect on NextEra Energy of failure to proceed with projects under development or inability to complete the construction of (or capital improvements to) electric generation, transmission and distribution facilities, gas infrastructure facilities or other facilities on schedule or within budget; impact on development and operating activities of NextEra Energy resulting from risks related to project siting, planning, financing, construction, permitting, governmental approvals and the negotiation of project development agreements, as well as supply chain disruptions; risks involved in the operation and maintenance of electric generation, transmission and distribution facilities, gas infrastructure facilities, retail gas distribution system in Florida and other facilities; effect on NextEra Energy of a lack of growth or slower growth in the number of customers or in customer usage; impact on NextEra Energy of severe weather and other weather conditions; threats of terrorism and catastrophic events that could result from geopolitical factors, terrorism, cyberattacks or other attempts to disrupt NextEra Energy's business or the businesses of third parties; inability to obtain adequate insurance coverage for protection of NextEra Energy against significant losses and risk that insurance coverage does not provide protection against all significant losses; a prolonged period of low gas and oil prices could impact NextEra Energy's gas infrastructure business and cause NextEra Energy to delay or cancel certain gas infrastructure projects and could result in certain projects becoming impaired; risk of increased operating costs resulting from unfavorable supply costs necessary to provide full energy and capacity requirement services; inability or failure to manage properly or hedge effectively the commodity risk within its portfolio; effect of reductions in the liquidity of energy markets on NextEra Energy's ability to manage operational risks; effectiveness of NextEra Energy's risk management tools associated with its hedging and trading procedures to protect against significant losses, including the effect of unforeseen price variances from historical behavior; impact of unavailability or disruption of power transmission or commodity transportation facilities on sale and delivery of power or natural gas; exposure of NextEra Energy to credit and performance risk from customers, hedging counterparties and vendors; failure of counterparties to perform under derivative contracts or of requirement for NextEra Energy to post margin cash collateral under derivative contracts; failure or breach of NextEra Energy's information technology systems; risks to NextEra Energy's retail businesses from compromise of sensitive customer data; losses from volatility in the market values of derivative instruments and limited liquidity in over-the-counter markets; impact of negative publicity; inability to maintain, negotiate or renegotiate acceptable franchise agreements; occurrence of work strikes or stoppages and increasing personnel costs; NextEra Energy's ability to successfully identify, complete and integrate acquisitions, including the effect of increased competition for acquisitions; environmental, health and financial risks associated with ownership and operation of nuclear generation facilities; liability of NextEra Energy for significant retrospective assessments and/or retrospective insurance premiums in the event of an incident at certain nuclear generation facilities; increased operating and capital expenditures and/or reduced revenues at nuclear generation facilities resulting from orders or new regulations of the Nuclear Regulatory Commission; inability to operate any of NextEra Energy's owned nuclear generation units through the end of their respective operating licenses; effect of disruptions, uncertainty or volatility in the credit and capital markets or actions by third parties in connection with project-specific or other financing arrangements on NextEra Energy's ability to fund its liquidity and capital needs and meet its growth objectives; inability to maintain current credit ratings; impairment of liquidity from inability of credit providers to fund their credit commitments or to maintain their current credit ratings; poor market performance and other economic factors that could affect NextEra Energy's defined benefit pension plan's funded status; poor market performance and other risks to the asset values of nuclear decommissioning funds; changes in market value and other risks to certain of NextEra Energy's investments; effect of inability of NextEra Energy subsidiaries to pay upstream dividends or repay funds to NextEra Energy or of NextEra Energy's performance under guarantees of subsidiary obligations on NextEra Energy's ability to meet its financial obligations and to pay dividends on its common stock; the fact that the amount and timing of dividends payable on NextEra Energy's common stock, as well as the dividend policy approved by NextEra Energy's board of directors from time to time, and changes to that policy, are within the sole discretion of NextEra Energy's board of directors and, if declared and paid, dividends may be in amounts that are less than might be expected by shareholders; NextEra Energy Partners, LP's inability to access sources of capital on commercially reasonable terms could have an effect on its ability to consummate future acquisitions and on the value of NextEra Energy's limited partner interest in NextEra Energy Operating Partners, LP; effects of disruptions, uncertainty or volatility in the credit and capital markets on the market price of NextEra Energy's common stock; and the ultimate severity and duration of public health crises, epidemics and pandemics, and its effects on NextEra Energy's business. NextEra Energy discusses these and other risks and uncertainties in its annual report on Form 10-K for the year ended December 31, 2022 and other Securities and Exchange Commission (SEC) filings, and this news release should be read in conjunction with such SEC filings. The forward-looking statements made in this news release are made only as of the date of this news release and NextEra Energy undertakes no obligation to update any forward-looking statements.

View original content to download multimedia:https://www.prnewswire.com/news-releases/nextera-energy-board-declares-quarterly-dividend-and-continues-above-average-targeted-growth-rate-in-dividends-per-share-through-at-least-2026-302064230.html

SOURCE NextEra Energy, Inc.

FAQ

What is the new quarterly common stock dividend declared by NextEra Energy (NEE)?

NextEra Energy (NEE) declared a regular quarterly common stock dividend of $0.515 per share, representing an approximate 10% increase compared to the prior-year dividend.

When is the dividend payable to NextEra Energy (NEE) shareholders?

The dividend declared by NextEra Energy (NEE) is payable on March 15, 2024, to shareholders of record as of Feb. 27, 2024.

What is the expected growth rate in dividends per share for NextEra Energy (NEE) beyond 2024?

NextEra Energy (NEE) anticipates a growth rate in dividends per share of roughly 10% per year through at least 2026, based on a 2024 base of $2.06 per share.

Who is the chairman, president, and CEO of NextEra Energy (NEE)?

John Ketchum serves as the chairman, president, and chief executive officer of NextEra Energy (NEE).

What is the payout ratio of NextEra Energy (NEE) at the end of 2023?

NextEra Energy (NEE) reported a 59% payout ratio at the end of 2023, which is below the peer average of approximately 65%.