BEPC - Intrigued by NextEra Energy Partners' Monster Dividend? Check Out These Safer Alternatives First.
2024-04-29 09:50:00 ET
NextEra Energy Partners (NYSE: NEP) currently offers an eye-popping dividend yield of more than 12%. That's several times higher than the S&P 500's 1.4% dividend yield. That much higher rate would enable investors to generate a lot more income for every dollar they invest in the renewable energy company.
However, since that high dividend yield comes with a higher risk profile, investors seeking to generate a generous passive income stream from the renewable energy sector should consider Brookfield Renewable (NYSE: BEPC) (NYSE: BEP) or Clearway Energy (NYSE: CWEN) (NYSE: CWEN.A) first. Their high-yielding payouts are on much more sustainable foundations right now.
NextEra Energy Partners' stock has lost roughly two-thirds of its value over the past three years. The primary factor has been surging interest rates. They've increased its cost of capital by making it a lot more expensive for the company to issue new debt or shares to refinance existing funding as it matures or finance new investments. While this headwind isn't unique to NextEra Energy Partners, it has hit the company harder because of its weaker financial foundation, including a junk credit rating .
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Intrigued by NextEra Energy Partners' Monster Dividend? Check Out These Safer Alternatives First.