UPDATE: Goldman Sachs Upgrades NextEra Energy to Buy on Good EPS/Dividend Growth

In a report published Wednesday, Goldman Sachs analyst Michael Lapides upgraded the rating on NextEra Energy NEE from Neutral to Buy, and raised the price target from $74.00 to $84.00. In the report, Lapides noted, “We upgrade NextEra Energy (NEE) to Buy from Neutral and add the shares to the Americas Conviction List to reflect (1) top-tier dividend growth given a below-average payout ratio, above-average EPS growth, and improving cash flow, (2) limited regulatory risk driven by a multi-year rate deal for its large Florida utility business, and (3) growth driven by new renewable developments for NEE's highly contracted, non-regulated segment. Historically, utilities with top-quartile dividend growth typically outperform – despite NEE outperforming over the last 12 months, we expect further outperformance given almost 10% dividend growth. We remain around 1%-2% above consensus in 2013-2015 and see 11% total return potential for NEE.” NextEra Energy closed on Tuesday at $77.68.