Week #11NEE

Stock of the Week #11 — NextEra Energy (NEE), Again

August 24, 2026

Five-box test: ✓ Pays · ✓ Raises · ✓ Safe · ✓ Undervalued · ✓ Yield that matters

Week eleven, another $100, and for the first time in this series we didn't buy a new company at all.

Ten weeks, ten businesses: a rural retailer, a medical-device maker, a landlord, a utility, a snack giant, the payroll company, a home-improvement Aristocrat, an asset manager, a sneaker brand, and a spice company. This week we bought NextEra Energy (NEE) for the second time, and we think the reason is more interesting than another new ticker would have been.

We went looking for something new. We didn't find it.

We screened five other companies this morning before settling on one we already owned. Here's the whole board, scored the same way every stock in this portfolio gets scored:

Two of those are worth a sentence each, because they show the test doing its job in opposite directions.

Campbell's looked tempting. A 6.5% yield on a household name, at a price well below its own five-year norm. But the dividend sat frozen at 37 cents a quarter from 2021 until mid-2024. A company that stops raising its dividend for three years is telling you something, and our second box exists to listen. We passed.

Cisco is the opposite failure, and it's the one from our very first post. Fifteen years of payments, fourteen straight raises, a healthy 50% payout. It clears the first three boxes easily. Then you get to the yield: 1.51%. A hundred dollars buys about a dollar fifty a year. It's a fine company and a poor income holding, which is exactly the distinction the fifth box was built to make.

So we bought more NextEra

We first bought NEE in week four, on July 6th, at $87.22. It scored 80 that day. Today it scores 88. Same company, seven weeks later, eight points better.

That isn't us changing our minds. Every input moved, and you can check each one:

The dividend hasn't changed since February. So the higher yield isn't the company paying more, it's the stock getting cheaper: $87.22 in July, $83.63 this morning. Meanwhile the company's trailing earnings climbed from about $3.96 a share to $4.46, which is what pulled the payout ratio down from 63% to 56%.

Cheaper stock, safer dividend, longer streak. That's the good version of a share price going down, and it's the version worth buying more of.

Why we'd rather add to a winner than reach for a new name

We were specifically hunting for a sector we don't own yet. Two of the three utilities we looked at, Duke and Southern, have longer payment records than NextEra. Duke has paid for 100 straight years. Southern for 79. Those are extraordinary records, and we'd happily own either one someday.

But both are currently yielding about 10% less than they historically have, which is another way of saying they're pricier than usual, and both grow their dividends at 2 to 3% a year. NextEra's yield sits about 18% above its own norm, and it has raised its dividend about 10% in each of the last two years. When the choice is a slightly bigger check today or a check that grows three times faster from a safer starting point, this portfolio takes the growth.

Buying more of your best idea instead of your seventh-best new idea is a real strategy, not a cop-out. Over years, this is how a portfolio ends up concentrated in the things that actually deserve the money.

The honest part

Three things we want on the record.

This makes NextEra our largest position by a wide margin. It's now about 18% of the portfolio, nearly double any other holding. Concentration cuts both ways. If we're right about NextEra, that's exactly what we want. If NextEra runs into trouble, it will hurt more than any single mistake has hurt so far.

It doesn't diversify us at all. We set out this week to add a sector we don't own, and we ended up adding to a sector we already own, in the same stock. The spread across this portfolio is genuinely narrower than it was yesterday. We'd rather buy the best thing available and tell you it didn't diversify us than buy a worse thing and call it balance.

This buy slightly lowers our blended yield. NextEra pays 2.98%, and the portfolio as a whole is yielding about 3.56% on what we've put in, so this purchase pulls the average income rate down a hair while pulling the average growth rate up. That's the same trade we wrote about in week three with Realty Income, run in reverse. Back then we took more income now and slower growth. This week we're taking less income now and faster growth. A portfolio needs both kinds, and we'd rather explain the tension than pretend it isn't there.

One note on our own projection

The forward income projection on our home page uses each holding's expected dividend growth rate. For NextEra we've kept that at 6%, which is what management has guided to for the years after 2026, even though the last two raises both came in at about 10%.

We could have used 10% and made our own projection look better. But guidance says 6%, this is now our largest holding, and a projection built on a rate the company has told us not to expect isn't a projection we'd want to defend in three years. So it stays at 6%.

The numbers on this week's buy

• Invested: $100.00
• Bought: 1.1958 shares at $83.63
• New annual dividend income added: about $2.98 per year
• Our NextEra position now: 2.3423 shares, worth about $195.89, paying about $5.84 a year
• The portfolio after 11 weeks: $1,101.34 invested, about $39.22 a year in forward income, roughly $3.27 a month
• Every dividend flows into the next pick, so the income keeps compounding between buys.

Eleven weeks, ten businesses, and the first time the test told us the best thing on the board was already sitting in the account. The running totals are on the portfolio page, and the slider lets you drag through time to watch the income grow.

That's week eleven. Sometimes the discipline is buying something new. Sometimes it's admitting nothing new was better. See you next week for pick number twelve.

This is not financial advice. We're individual investors sharing our own approach and the reasoning behind our own real decisions, not licensed advisors. We own, or are buying, the stocks we write about in this series. Do your own research and consider speaking with a financial professional before investing. Dividend figures, yields, share counts, and prices are accurate to the best of our knowledge as of the publish date and will change over time.