NextEra Energy Gains Ahead Of Q3 Earnings On Power Supply Deal With Google

• According to Fiscal.ai data, Wall Street expects the company to post earnings of $1.02 per share on revenue of $9.22 billion.
• NextEra and Google revealed that they have signed an agreement to restart the Duane Arnold nuclear power plant in Iowa to power the tech giant’s cloud infrastructure. 
• NextEra's direct value accretion from a restart of Duane Arnold could be about $1 per share – BTIG.

NextEra Energy (NEE) stock gained 3.7% in premarket trading on Tuesday, ahead of the utility firm’s third-quarter earnings.

According to Fiscal.ai data, Wall Street expects the company to post earnings of $1.02 per share on revenue of $9.22 billion. The company has topped or matched expectations in all four previous quarters.

Google Deal Highlights AI-Data Center Demand

On Monday, NextEra and Google revealed that they have signed an agreement to restart the Duane Arnold nuclear power plant in Iowa to power the tech giant’s cloud infrastructure.

The nuclear plant, located near Cedar Rapids, was shut down five years ago. The two companies said that Google will buy electricity from the 615-megawatt facility for 25 years, beginning when the plant comes online and begins delivering electricity to the grid in the first quarter of 2029. NextEra said it will own 100% of the plant after buying out the other owners' stakes.

U.S. data centers will require 22% more grid power by the end of 2025 than they did one year earlier, and will need nearly three times as much in 2030, according to a report by the S&P Global. Several technology companies are tapping nuclear power to deliver virtually emission-free, reliable energy around the clock. Last year, Microsoft struck an agreement with Constellation Energy to restart the Three Mile Island nuclear power plant in Pennsylvania.

"This partnership serves as a model for the investments needed across the country to build energy capacity and deliver reliable, clean power, while protecting affordability and creating jobs that will drive the AI-driven economy," said Ruth Porat, president and chief investment officer of Alphabet and Google.

What Is Retail Thinking?

Retail sentiment on Stocktwits on NextEra Energy was in the ‘extreme bullish’ territory at the time of writing, compared with ‘bearish’ a day ago.

One investor hoped the stock would hit $90 soon.

What Are Analysts Saying?

According to TheFly, BTIG analysts said that while the deal was not unexpected, the firm estimates that NextEra's direct value accretion from a restart of Duane Arnold could be about $1 per share.

NextEra stock has gained 18.7% this year. However, the stock is up only about 4.9% over the past 12 months, amid concerns over its renewable energy projects, due to the Trump administration's unfavorable stance toward green energy.

Evercore ISI analysts said earlier in October that while the company is seen as the U.S. leader in wind and solar, with about 20% of the U.S. renewables market, it is also the nation's leading power provider, with the ability to provide the entire spectrum of generation assets.

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