JUNO BEACH, FL – NextEra Energy Capital Holdings, Inc. (NEECH), a fully owned subsidiary of NextEra Energy, Inc. (NYSE:NEE), has announced the sale of $2.5 billion in junior subordinated debentures, according to a recent SEC filing. The utility giant, currently valued at $141.9 billion, maintains a FAIR financial health score according to InvestingPro analysis. The offering consists of two series: $1.5 billion of Series S Junior Subordinated Debentures due August 15, 2055, and $1 billion of Series T Junior Subordinated Debentures with the same maturity date.
The Series S Debentures will carry an interest rate of 6.375% until August 15, 2030, after which the rate will adjust to the Five-Year Treasury Rate plus 2.053%, resetting every five years. Similarly, the Series T Debentures will have an initial interest rate of 6.50% until August 15, 2035, followed by a rate based on the Five-Year Treasury Rate plus 1.979%, also resetting every five years. Both series guarantee that the interest rate will not fall below the initial rate after adjustments. This debt offering adds to NextEra’s existing total debt of $82.3 billion, with current financial metrics showing a current ratio of 0.47.
NEECH reserves the right to redeem some or all of the debentures during specified periods starting in May 2030 for the Series S Debentures and May 2035 for the Series T Debentures. NextEra Energy, Inc. backs the junior subordinated debentures on a subordinated basis.
The debentures were registered under the Securities Act of 1933 and sold on February 6, 2025. The sale aligns with NextEra Energy’s strategic financial planning and capital allocation to support its growth objectives. Despite short-term obligations exceeding liquid assets, the company has maintained an impressive 29-year streak of dividend increases. For deeper insights into NextEra’s financial health and detailed analysis, access the comprehensive Pro Research Report available on InvestingPro. This information is based on a press release statement filed with the SEC.
In other recent news, NextEra Energy has made significant financial strides, with its subsidiary, NextEra Energy Capital Holdings, issuing $5 billion in debentures. The offering includes debentures with varying interest rates and maturities, all guaranteed by NextEra Energy. In the realm of analyst ratings, UBS has maintained a Buy rating on NextEra Energy, emphasizing the company’s growth prospects and potential for top quartile earnings per share growth. Similarly, Guggenheim also reiterated a Buy rating on the company’s shares, following a robust performance from its regulated utility segment and subsidiary, NextEra Energy Resources.
Bank of America (NYSE:BAC) Securities, on the other hand, has maintained a Neutral rating on NextEra Energy, while raising the price target from $71 to $74. This adjustment follows the company’s strategic shift towards gas development in partnership with GE Vernova, a move that is expected to enhance the company’s value proposition. Meanwhile, NextEra Energy’s fourth-quarter adjusted earnings per share (EPS) of $0.53 marginally surpassed BofA’s projection of $0.51, demonstrating a slight increase from the same quarter of the previous year.
These recent developments indicate a strong financial performance and growth potential for NextEra Energy, with the company making significant moves in the energy sector and receiving positive analyst ratings. However, as always, investors are encouraged to conduct their own research and consult with financial advisors before making investment decisions.
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