NextEra Energy, Inc. (NYSE:NEE) has outlined its growth targets for 2026 and beyond. This comes as the company advances plans to acquire Dominion Energy Inc (NYSE:D). It’s a $67 billion all-stock transaction expected to close before the end of next year. If the merger is completed as expected, it would result in the largest US electricity producer.
NextEra’s business is already growing, and Dominion is expected to increase the growth rate. The deal’s promise is exciting, but its value to investors ultimately depends on NextEra securing regulatory approvals and successfully integrating Dominion assets.
NextEra Already Has a Strong Standalone Growth Path
NextEra Energy, Inc. has reaffirmed its 2026 adjusted EPS guidance of $3.92 to $4.02 and said it was targeting the high end of that range. NextEra also said it expects adjusted EPS to grow at a compound annual rate of at least 8% through 2032 and is targeting the same growth rate through 2035, off the 2025 base.
NextEra also plans to continue rewarding its shareholders with higher dividends. The company expects its dividend per share to grow at a roughly 10% annual rate through 2026, off the 2024 base. It expects the dividend to grow 6% a year through 2028 from the 2026 base.
The EPS and dividend growth projections give investors a financial foundation for evaluating the Dominion deal. NextEra does not need Dominion simply to prevent a growth slowdown. Instead, it’s looking to add another growth engine through the acquisition.
NextEra expects Dominion to be immediately accretive to adjusted EPS. The combined company is expected to deliver 9%+ adjusted EPS growth through 2032 and is targeting the same growth rate through 2035, off NextEra’s 2025 base.
The combined company would operate the largest natural gas-fired generation fleet in the U.S. and the second-largest nuclear fleet.
The Merger’s Financial Case Depends on Regulatory Approval
NextEra Energy, Inc. expects to close the Dominion transaction in the second half of 2027. The biggest near-term test is whether NextEra can secure the regulatory approvals to close the deal in the expected time.
The companies are trying to improve the deal’s approval chances through an expanded benefits package submitted to Virginia regulators. In updated filings, they have proposed to double residential bill credits to four years. Additionally, they are committing to shielding retail customers from grid costs associated with Northern Virginia’s rapidly expanding AI data centers.
And that’s not all. They have also added $100 million to Dominion’s low-income bill assistance program through 2038 and another $100 million for workforce development. These commitments matter because the deal’s expected benefits hinge on regulatory approvals.
The merger could strengthen NextEra’s growth trajectory if it closes on time and with favorable conditions. But the thesis weakens if the deal’s closing is delayed or regulators impose conditions that materially diminish the deal’s expected economic benefits.
Investor Positioning Is Expanding, But Conviction Is Mixed
Insider Monkey’s hedge fund database suggests that elite investors are paying attention to NextEra Energy, Inc.’s growth prospects. But major funds are showing divergent trades.
The number of hedge funds holding NextEra stock increased to 80 in Q2 from 74 in Q1. GQG Partners remained the largest hedge fund holder, though it did reduce its stake by 20% to 7.42 million shares. But Marshall Wace, the second-largest holder, increased its stake 350% to 3.37 million shares. Balyasny Asset Management also raised its stake by 2,084% to 1.62 million shares.
Regarding bearish bets, some 49.8 million NextEra shares were shorted as of August 31. That represents 2.39% of the float and remained essentially unchanged from the previous reading.
The big question right now is whether NextEra can maintain its standalone growth while absorbing Dominion. The reaffirmed 2026 outlook and 2035 projections provide a solid starting point. But regulatory approvals and execution remain major tests.
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