NextEra Energy Inc (NEE.N): FERC Requested Additional Information for Merger, Small Hiccup but Cautiously Positive

Citi's flash note on NextEra Energy (NEE.N) notes that FERC ruled the company's merger application deficient and requested additional information to be filed within 30 days (by October 22). Most of the requested information appears procedural, though there may be additional analysis on market competition in PJM that could spark further stakeholder discussion. Citi continues to believe FERC will ultimately approve the merger, but acknowledges that the approval timeline may slip by up to 180 days to July 8, 2027, with the deal closing roughly six months later than the companies originally guided. Citi maintains a Buy rating with a target price of US$102.00 versus the US$77.02 share price, implying 32.4% expected share price return, 3.3% dividend yield and 35.8% expected total return. The target price is a weighted average of a 21.5x P/E on 2028 consolidated EPS, two sum-of-the-parts valuations and a dividend discount model, plus about US$1 of value uplift related to the Duane Arnold rest