The Florida-based NextEra Energy’s (NEE) stock is currently trading at a price-to-earnings (or PE) multiple of 21.0x. It has a five-year historical average 20x. The average PE multiple for utilities is around 13.0x. So, NEE seems to be trading at a premium to peers as well as its historical average.
NextEra Energy stock is presently trading at an EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) valuation multiple of 14.5x. It has a five-year historical average near 13.0x. The average EV-to-EBITDA multiple for utilities is 11.0x. So, based on EV-to-EBITDA multiple as well, NEE seems to be trading at a premium to both its historical average and the industry average (XLU).
Let’s move on to NRG Energy next in this series.