2. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 73
NextEra Energy, Inc. (NYSE:NEE) is a prominent energy company renowned for its substantial role in the global energy sector. The company operates a diverse portfolio through its subsidiaries, which include Florida Power & Light (FPL), NextEra Energy Resources (NEER), and NextEra Energy Partners. FPL serves a vast customer base in Florida, while NEER is a leading global producer of renewable energy, focusing on wind and solar power.
From 2005 to 2021, NextEra (NYSE:NEE) made significant strides in reducing its CO2 emissions rate, improving it by 51% compared to the U.S. electric power sector average. This improvement occurred even as the company expanded its total generation capacity by 72% to keep up with increasing customer demand. While the company grew its operations significantly to serve more customers, it managed to cut its emissions rate more effectively than most of its competitors in the industry.
According to the company’s Net Zero blue-print, FPL has built one of the most efficient and environmentally friendly power generation systems in the U.S. Its modernized infrastructure has saved Florida customers over $12 billion in fuel costs and reduced CO2 emissions by more than 175 million tons since 2001. Its solar initiatives, including the largest community solar program in the country, have positioned Florida as the third-highest state for solar capacity.
NextEra (NYSE:NEE) has a 2045 Real Zero goal, which means that it aims to achieve net-zero emissions without adding extra costs for customers. The company is committed to ensuring that each new project remains cost-effective for customers while achieving emissions reduction goals, provided it receives regulatory approval. It is one of the best ethical companies to invest in.
It has outlined a three-part strategy for achieving its decarbonization goals. First, the company aims to become carbon neutral within its operations by 2045, without relying on carbon offsets. This goal shows its longstanding commitment to sustainability.
Second, the company plans to support the broader U.S. power sector in reducing carbon emissions, which include investor-owned utilities, municipal systems, and cooperatives. It will do this by investing in and advancing technologies like wind, solar, energy storage, and green hydrogen.
Third, NextEra (NYSE:NEE) is planning to lead efforts in decarbonizing the U.S. economy as a whole. It intends to become the go-to partner for businesses looking to cut their carbon footprints. By leveraging its expertise and data analytics, it will help commercial and industrial clients meet their own net-zero or Real Zero targets.
In Q2, NextEra’s (NYSE:NEE) shares were held by 73 hedge funds at a combined value of $2.1 billion. Rajiv Jain’s GQG Partners increased its stake in the company by over 850% in the second quarter to 12.5 million shares worth $884.560 and is the most prominent shareholder of the company.
ClearBridge Investments stated the following regarding NextEra Energy, Inc. (NYSE:NEE) in its Q2 2024 investor letter:
“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 Energy, 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.”
