2024-03-15 18:14:22 ET
Summary
- NextEra Energy Partners has experienced a massive decline in its share price, while the performance at the fundamental level has remained robust.
- As a result of stable and even increasing financial results and a plunging share price, the current yield has skyrocketed to 12%.
- This creates attractive conditions, where the bulls can channel capital into NEP since the fundamentals are still strong and even the company has raised its dividend for 2024.
- However, assessing the company more thoroughly, we can identify several areas of concern, which together make the overall investment case too speculative and risky.
- In this article, I provide color on these areas and explain why I think that the current yield is unsustainable.
NextEra Energy Partners, LP ( NEP ) is a growth and dividend focused limited partnership. It plays across clean energy, natural gas and transmission segments in the U.S. NEP could also be considered the nation's largest electric utility and the fourth largest U.S. renewable energy company....
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NextEra Energy Partners: Tempting, But A Far Cry From A Buy