NextEra Energy, Inc. (NEE) Fair Value & PE Analysis
Regulated Electric · NYSE
Current Price
$88.46
PE Ratio (TTM)
19.8x
Intrinsic Value
$106.01
+16.6% margin of safety
What Is NextEra Energy, Inc.'s Fair Value?
As of 2026-07-29, applying a 20.0x earnings multiple to NextEra Energy, Inc.'s (NEE) earnings per share of $4.45 yields a fair value estimate of $106.01 per share, versus a market price of $88.46.
Fair value from earnings multiples is sensitive to the multiple you choose. Across the sensitivity grid the estimate spans $85.83 to $129.14. This is a relative estimate anchored to earnings, not a statement of fact. For a cash flow based view, see the intrinsic value estimate on the DCF page.
How the PE model works · Recalculate in PE mode · NEE intrinsic value (DCF view)
Is NextEra Energy, Inc. (NEE) Overvalued?
At $88.46, NEE trades about 16.6% below its PE-based fair value estimate, a modest discount to its earnings power, though not enough to call it cheap outright.
COMPETITIVE MOAT
↑Regulated Monopoly Infrastructure
NEE operates as a regulated utility, granting it exclusive rights to serve specific geographic areas. This prevents direct competition for its core electricity distribution and transmission services.
↑High Capital Intensity
Building and maintaining electric infrastructure requires massive upfront investment. This creates a significant barrier to entry for potential competitors seeking to replicate NEE's network.
↑Long-Term Contracts
NEE secures long-term power purchase agreements with renewable energy projects. These contracts provide predictable revenue streams and insulate it from short-term energy price volatility.
INVESTMENT RISKS
↓Extreme Weather Events
NEE's infrastructure is vulnerable to damage from hurricanes, wildfires, and other severe weather. Such events can lead to significant repair costs and service disruptions.
↓Interest Rate Sensitivity
As a capital-intensive business, NEE relies heavily on debt financing. Rising interest rates increase borrowing costs, impacting profitability and investment capacity.
↓Policy and Environmental Regulations
Changes in government policies regarding renewable energy mandates, carbon emissions, and environmental standards can affect NEE's operational costs and strategic direction.
Base case
NEE base case PE valuation
Intrinsic Value
$106.01
Margin of safety
+16.6%
Expected annual return
+3.7%
Base case assumptions: 8.9% annual earnings growth, 20x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the NEE PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for NextEra Energy, Inc. respond.
Open PE Calculator for NEECompany Overview
NextEra Energy, Inc., operating through its diverse subsidiaries, is a prominent electric power provider in North America. The company's operations encompass the generation, transmission, distribution, and sale of electricity to both individual consumers and large-scale wholesale clients. Its energy portfolio is broad, featuring power generation from wind, solar, nuclear, coal, and natural gas facilities. Beyond direct power supply, NextEra Energy is actively involved in developing, constructing, and managing long-term contracted clean energy infrastructure, including renewable energy generation sites, battery storage solutions, and electric transmission networks. The firm also participates in the sale of energy commodities and oversees the development, construction, and operation of generation assets within competitive wholesale energy markets. As of December 31, 2021, NextEra Energy boasted a net generating capacity of approximately 28,564 megawatts. Its extensive infrastructure included about 77,000 circuit miles of transmission and distribution lines and 696 substations. Within Florida, the company delivers electricity to roughly 11 million individuals, serving approximately 5.7 million customer accounts across the state's eastern and lower western coastal regions. Founded in 1925, the company adopted its current name, NextEra Energy, Inc., in 2010, having previously operated as FPL Group, Inc. Its corporate headquarters are located in Juno Beach, Florida.
Financial Metrics — NEE PE Stock Valuation Data
PE Ratio (TTM)
19.8x
PEG Ratio
0.36
Earnings Yield
5.03%
ROE (TTM)
16.8%
Revenue/Share (TTM)
$13.89
Dividend Yield
2.69%
Debt/Equity
0.20x
Frequently Asked Questions
What is the PE ratio of NEE?
The trailing twelve-month PE ratio of NEE reflects how much investors pay per dollar of NextEra Energy, Inc.'s earnings. This metric is most useful when compared to Regulated Electric peers and the company's own historical range.
Is NEE overvalued based on PE ratio?
NEE's PE of 19.8x combined with a PEG ratio of 0.36 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Regulated Electric, a DCF analysis may be more appropriate.
How do I value NEE stock using PE ratio?
To value NextEra Energy, Inc. using PE: (1) Compare the current PE (19.8x) against the Regulated Electric median to assess relative pricing, (2) check the PEG ratio (0.36) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of NEE?
NEE's PEG ratio is 0.36, calculated by dividing the PE ratio (19.8x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for NEE stock valuation?
PE ratio gives a quick relative read — how NEE is priced versus Regulated Electric peers. DCF provides an absolute value based on projected free cash flows. For NEE, with a strong ROE of 16.8%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See NEE DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Utilities valuationsP/E and DCF value NEE with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.