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NextEra Energy (NEE) Beats on Q2 Earnings, Keeps '17 View

NextEra Energy, Inc. NEE reported second-quarter 2017 adjusted earnings of $1.86 per share, beating the Zacks Consensus Estimate of $1.76 by 5.7%. Reported earnings were also up by 11.4% year over year.

The year-over-year growth in earnings was primarily due to solid contribution from both Florida Power & Light Company and NextEra Energy Resources segments.

On a GAAP basis, NextEra Energy recorded second-quarter earnings of $1.68 per share, up from $1.16 a year ago. The variance between GAAP and adjusted earnings was primarily due to loss of 32 cents from the non-qualifying hedges and merger related expenses of a penny. The loss was offset by a one-time gain of 14 cents from income tax expenses and income of one penny from Spanish solar projects.

Total Revenue

In the second quarter, NextEra Energy’s operating revenues were $4,404 million, surpassing the Zacks Consensus Estimate of $4,353 million by nearly 1.2%. Reported revenues also improved 15.4% from $3,817 million a year ago.

NextEra Energy, Inc. Price, Consensus and EPS Surprise

 

NextEra Energy, Inc. Price, Consensus and EPS Surprise | NextEra Energy, Inc. Quote

Segmental Results

Florida Power & Light Company (FPL): Earnings came in at $1.12 per share, up 16.7% from the prior-year quarter figure. Revenues amounted to $3,091 million, up 12.4% from $2,750 in the prior-year quarter.

NextEra Energy Resources (NEER): Quarterly earnings came in at 74 cents per share, up from 67 cents in the year-ago quarter. Revenues improved 33.5% to $1,295 million.

Corporate and Other: Quarterly earnings were breakeven compared with year-ago earnings of 4 cents. Revenues in the reported quarter came in at $18 million, down 81.4%.

Operational Update

In the reported quarter, NextEra Energy’s total operating expenses were up 17.8% to $3,119 million primarily due to higher fuel, purchased power and interchange.

Operating income rose 9.9% to $1,285 million from $1,169 million a year ago.

Interest expenses in the reported quarter were $430 million compared with $602 million in the year-ago quarter.

In the reported quarter, Florida Power & Light Company’s average price of electricity went up 10.6% year over year and total average customer count went up 1.3% year over year.

Financial Update

NextEra Energy had cash and cash equivalents of $642 million as of Jun 30, 2017, compared with $1,292 million as of Dec 31, 2016.

Long-term debt as of Jun 30, 2017 was $30.4 billion, up from $27.8 billion as of Dec 31, 2016.

NextEra Energy’s cash flow from operating activities in the first half of 2017 was $3,165 million, compared with $3,270 million in the year-ago period.

Guidance

NextEra Energy reiterated its adjusted earnings guidance in the range of $6.35–$6.85 for 2017 and $6.80–$7.30 for 2018. The company expects earnings to grow at a compound annual rate of 6–8% per year through 2020, off a 2016 base.

Zacks Rank

NextEra Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Peer Releases

Xcel Energy XEL is scheduled to report second-quarter 2017 results on Jul 27. The Zacks Consensus Estimate of 42 cents remained unchanged in the last 30 days.

CMS Energy Corp. CMS is scheduled to report second-quarter 2017 results on Jul 28. The Zacks Consensus Estimate of 42 cents remained unchanged in the last 30 days.

Entergy Corp. ETR is slated to report second-quarter 2017 results on Aug 2. The Zacks Consensus Estimate of $1.22 moved up by a penny in the last 30 days.

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