Renewable Utilities · NYSE
Current Price
$10.54
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on NextEra Energy Partners, LP with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
NextEra Energy Partners, LP acquires, owns, and manages contracted clean energy projects in the United States. It owns a portfolio of contracted renewable generation assets consisting of wind and solar projects, as well as contracted natural gas pipeline assets. NextEra Energy Partners, LP was incorporated in 2014 and is headquartered in Juno Beach, Florida.
ROIC (TTM)
-0.8%
ROE (TTM)
-0.9%
FCF Yield
-54.98%
Based on trailing twelve-month data, NEP shows a free cash flow per share of N/A and a ROIC of -0.8%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of -54.98% are important context metrics when evaluating NEP's stock valuation relative to peers.
The intrinsic value of NEP depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether NEP is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $10.54. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on NextEra Energy Partners, LP: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Renewable Utilities industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting NEP's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For NextEra Energy Partners, LP, this means projecting how much free cash flow the Renewable Utilities will produce over the next 5-10 years, then discounting those amounts to today's dollars. NEP's ROIC of -0.8% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For NEP, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
