5 Best Energy Storage Stocks to Buy According to Hedge Funds

2. NextEra Energy Inc. (NYSE:NEE)

Number of Hedge Funds Holding: 72

Stock Upside: 4.07%

NextEra Energy Inc. (NYSE:NEE) is one of the best energy storage stocks to buy according to hedge funds. On March 31, Jefferies analyst Julien Dumoulin-Smith raised his price target on NextEra Energy Inc. (NYSE:NEE) from $87 to $92 while keeping a Hold rating. The analyst cited confidence in NextEra’s long-term earnings growth trajectory and a reassessment of the stock’s valuation after a significant re-rating.

Dumoulin-Smith noted that he believes NextEra can deliver 8% or more EPS compound annual growth rate. The key near-term catalyst the analyst is watching is data center power deals, which he expects to materialize in 2026. This is consistent with an earlier note, published on January 26, in which Jefferies identified substantial power contracts related to large data centers as the primary driver for the stock in 2026.

On the data center power front, NextEra has a concrete project in motion, noted Dumoulin-Smith. The company is involved in 9.5 GW of natural gas power plant projects in Pennsylvania and Texas. These are tied to a broader $550 billion trade deal with Japan and enjoy the backing of President Trump, though Jefferies cautioned that this announcement is still in the very early stages.

However, the analyst noted the stock has re-rated to the highest utility premium on the Street, excluding Entergy (NYSE:ETR). As such, the stock is trading at a price-to-earnings ratio of 27.82, which puts it roughly 16% above its 2028 peers. This puts NextEra’s stock closer to fair value and leaves limited margin of safety for new buyers, Dumoulin-Smith concluded.

NextEra Energy Inc. (NYSE:NEE) is an electric utility and energy infrastructure company. Through its subsidiary, NextEra Energy Resources, it develops and operates utility-scale storage projects that provide energy shifting, frequency regulation, and capacity services.