2024-04-19 11:55:25 ET
Summary
- NextEra Energy's current dividend yield is way above its historical average, usually a sign for undervaluation.
- However, I will argue this signal is misleading in this case.
- The stock's valuation is still trading at a premium compared to its industry.
- A consideration of its growth potential also shows it's close to fair valuation and offers no obvious margin of safety.
Thesis
NextEra Energy, Inc. ( NEE ) caught our attention in our monthly review of dividend stocks. In these reviews, we specifically look for stocks with yields out of their historical ranges. And NEE really stood out as you can see from the chart below. Its current yield sits at 3.23% (shown by the solid red line). It's more than 1 standard deviation (shown by the orange line with symbols) above its historical average (shown by the gray dotted line). When something extraordinary shows up on our radar, we simply have to dig into it....
Read the full article on Seeking Alpha
For further details see:
NextEra Energy: Still Looking For Direction (Technical Analysis)