Shares of NextEra Energy (NYSE: NEE) jumped 4.1% in early morning trading on Thursday after the utility and renewable energy company reported better-than-expected adjusted earnings-per-share (EPS) for 2023. The impressive performance has positioned NextEra Energy for continued growth in 2024 and beyond, with expectations of hitting the top end of its adjusted EPS guidance through 2026.

NextEra Energy announced adjusted EPS of $3.17 per share in 2023, representing a 9% increase from the previous year and surpassing management's projections despite a challenging business environment. The company faced obstacles such as rising interest rates, heightened inflation, and supply issues, particularly in the solar sector.

Both of NextEra Energy's businesses, Florida Power & Light (FPL) and NextEra Energy Resources, experienced robust growth in the fourth quarter of 2023. FPL, which is the largest electric utility in America, saw a significant boost in earnings, surging by 20% for the year. This growth was driven by a substantial infrastructure investment of approximately $9.4 billion. Moreover, FPL's customer base expanded by 81,000 on a yearly basis in Q4.

NextEra Energy Resources, the company's renewable energy arm, witnessed a remarkable leap in EPS, reaching $1.75 per share in 2023 compared to just $0.14 per share in 2022. The year 2023 marked NextEra Energy Resources' record-breaking performance, as it added nearly 9 gigawatts of new renewables and battery storage projects to its backlog.

Despite the recent underperformance of NextEra Energy's stock, the company's management remains focused on execution and creating long-term value for shareholders. The company has outlined its financial goals through 2026, including an expected 2% to 8% growth in adjusted EPS for this year. By 2025 and 2026, NextEra Energy foresees 6% to 8% growth off its 2024 adjusted EPS range.

One notable aspect that has contributed to the stock surge is NextEra Energy's confidence in growing its dividend by at least 10% this year. With a dividend yield of 3.3% and the stock down approximately 32% in the past year, a potential 10% increase in dividends appears enticing to investors.

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In conclusion, NextEra Energy's impressive 2023 earnings and its optimistic growth outlook have ignited investor enthusiasm, leading to a surge in stock price. As the company looks ahead to strong performance in the coming years, its commitment to long-term shareholder value and a potential dividend increase further adds to its appeal.

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