NextEra Energy, Inc. (NEE): A Bull Case Theory

We came across a bullish thesis on NextEra Energy, Inc. on Paradox’s Substack by PARADOX INTELLIGENCE. In this article, we will summarize the bulls’ thesis on NEE. NextEra Energy, Inc.'s share was trading at $80.06 as of October 3rd. NEE’s trailing and forward P/E were 27.24 and 20.04 respectively according to Yahoo Finance.

The company is the largest U.S. renewable operator, with over 60 GW of solar and wind capacity and a 6 GW data center backlog, positioning it as a key provider for hyperscalers seeking to meet ESG commitments. Its portfolio benefits from long-term power purchase agreements (PPAs) with major tech companies, including Amazon, Google, Microsoft, and Meta, creating stable demand despite the inherent intermittency of renewable generation. The company delivered a strong Q2 2025 performance, reporting EPS of $1.05, above expectations, and projects an 8–10% EPS CAGR, while trading at a 20x forward P/E with a 2.6% dividend yield.

A $64–72 billion capital expenditure program through 2025 underlines its commitment to scaling capacity and supporting hyperscaler demand. While the business is well-positioned for long-term growth, it faces significant risks, including the need for grid-scale storage to manage intermittency, transmission constraints, and policy sensitivity as federal renewable incentives and tax credits sunset. This policy risk could impact near-term economics and the relative competitiveness of renewable generation versus baseload sources under the current regulatory framework.

Nevertheless, the company’s market leadership, deep hyperscaler relationships, and scale in solar and wind provide a structural growth story. With its capital program advancing and a de-risked financial profile, the stock offers an attractive risk/reward profile for investors seeking exposure to the accelerating energy transition. The combination of stable contracted demand, expansion opportunities, and potential policy tailwinds in the longer term creates a compelling investment case, even as near-term execution and regulatory challenges require careful monitoring.

Previously we covered a bullish thesis on PG&E Corporation (PCG) by Acid Investments in February 2025, which highlighted the market overreaction to the Los Angeles wildfires, PG&E’s lack of direct liability, and strong 2025 EPS guidance of $1.50 with 10% projected growth. The company's stock price has been flat since our coverage. The thesis still stands as fundamentals and risk mitigation remain solid. PARADOX INTELLIGENCE shares a similar perspective but emphasizes renewable growth and hyperscaler PPAs as key drivers for NextEra Energy, differentiating it from PG&E’s wildfire-focused thesis.

NextEra Energy, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 66 hedge fund portfolios held NEE at the end of the second quarter which was 75 in the previous quarter. While we acknowledge the potential of NEE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.