Is NextEra Energy, Inc. overvalued or undervalued?

As of 22 February 2024, the valuation grade for NextEra Energy, Inc. has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently deemed overvalued, with a P/E ratio of 36, an EV to EBITDA ratio of 18.43, and a PEG ratio of 0.06, which suggests that despite high earnings multiples, growth expectations are not being met.
In comparison to its peers, NextEra's P/E ratio is notably higher than that of The Southern Company at 22.71 and Duke Energy Corp. at 18.26, both categorized as expensive. This disparity highlights the overvaluation of NextEra relative to its industry. Additionally, the company's recent stock performance has lagged behind the S&P 500, with a year-to-date return of -1.34% compared to the index's 2.44%, further reinforcing the notion of overvaluation amidst a challenging market environment.