2. NextEra Energy (NYSE:NEE)
Number of Hedge Fund Holders: 73
Market Capitalization as of September 4: $166.83 Billion
NextEra Energy (NYSE:NEE) is the world’s leading producer of wind and solar energy and a pioneer in battery storage technology. Through its subsidiaries, such as Florida Power & Light, the company serves millions of customers and plays a key role in advancing the transition to a low-carbon economy through its investments in clean energy.
NextEra Energy (NYSE:NEE) operates two main businesses: Florida Power & Light (FPL), an electric utility, and NextEra Energy Resources (NEER), one of the world’s largest clean energy producers and a leader in battery storage. NEER focuses on developing, constructing, and operating long-term clean energy assets, primarily in the U.S. and Canada.
The company has over two decades of experience in developing and operating clean energy projects, NextEra Energy (NYSE:NEE) holds a strong competitive advantage. In 2022, the company held 56% of the wind energy market and 38% of the overall renewable market from 2019 to 2022. NextEra Energy Resources (NEER) operates a clean energy portfolio totaling around 34 GW, consisting of 24 GW from wind energy, 7 GW from solar energy, and 2 GW from nuclear energy. Additionally, NEER has 1 GW of battery storage capacity spread across 16 U.S. states.
Approximately 93% of NEER’s revenue is generated from long-term Power Purchase Agreements with data centers and tech companies which provide a stable and predictable cash flow. The company’s financial performance remains strong, with adjusted earnings growing by 10.8% in Q2 2024, driven by strategic investments and an expanding clean energy portfolio. Looking ahead, NEER expects its earnings per share (EPS) to grow by 6-8% annually through 2027 and plans to increase dividend payments by 10% per year. In their second quarter investor letter, ClearBridge stated the following regarding NextEra (NYSE:NEE):
“AI-related momentum was a key driver of performance in the second quarter, lifting the enablers in technology as well as holdings like renewable power producer NextEra, Inc. (NYSE:NEE) that supply the increasing energy needs of data centers. Parts of the market lacking an AI connection, like our medical device holdings, underperformed despite no change to fundamentals. We have managed through several similar momentum periods over our tenure and have delivered long-term results for shareholders by staying true to an approach that emphasizes diversification across three buckets of growth companies (select, stable and cyclical) and seeks to take advantage of attractive entry points into quality growth businesses.”
NextEra’s (NYSE:NEE) is valued at $166.83 billion as of September 4. The stock is held by 73 hedge funds with stakes worth $2.10 billion as of the second quarter. GQG Partners is the largest shareholder in the company and has stocks worth $884.56 million as of June 30.
