Hey there, bargain hunter.

On May 18, 2026, NextEra Energy (NYSE: NEE) and Dominion Energy (NYSE: D) announced a definitive agreement for NextEra to acquire Dominion in an all-stock deal valued at about $66.8 billion to $67 billion. It is being described as the largest utility transaction on record, and it would create the world’s largest regulated electric utility business by market capitalization.

NEE’s stock fell on the day of the announcement, while Dominion rose.

The acquirer got punished. That does not always mean the market is right.

What the Deal Actually Is

Under the agreement, Dominion shareholders receive 0.8138 NextEra shares for each share they own. The companies said the all-stock transaction is expected to be tax-free to shareholders. NextEra shareholders are expected to own approximately 74.5% of the combined company. The companies said they expect the deal to close in 12 to 18 months, subject to shareholder and regulatory approvals.

NextEra is already the world’s largest utility company by market cap. Dominion serves the Virginia footprint that includes Northern Virginia, widely regarded as the world’s largest data center market. Put those two together and you get a combined enterprise value of roughly $420 billion, which has been described as making it the third-largest U.S. energy company behind ExxonMobil and Chevron.

The companies have also pointed to AI-driven data center growth as a key demand catalyst behind the deal.

Why This Deal Makes Sense Right Now

This is where it gets interesting. The utility sector has been consolidating hard, and fast. In just the past year, Constellation Energy acquired Calpine in a transaction with an equity purchase price of about $16.4 billion (and a higher value including assumed debt). The NextEra-Dominion deal dwarfs that.

The driver behind a lot of the excitement is the same: AI infrastructure buildout. The electricity demand signal is not slowing. It is accelerating.

NextEra already leads the U.S. power and utility industry in market cap and is a major renewable energy and battery storage developer. Dominion brings roughly 4 million customers across Virginia, North Carolina, and South Carolina, plus exposure to that Virginia data center corridor. It is a strategic fit that is hard to argue with, even if the regulatory path will take time.

Where NEE Sits Right Now

NEE’s 52-week high is $98.75. As of late June 2026, shares have been trading in the high-$80s. The 52-week low has been reported around the mid-$60s.

The stock offers a dividend yield in the high-2% range. Morgan Stanley recently raised its price target to $117 from $111, keeping an Overweight rating.

NEE has also maintained a track record of consecutive annual dividend increases for more than three decades, and has communicated a target of roughly 10% annual dividend growth.

The Part People Are Skipping

The deal faces real risks. Some analysts have raised concerns about whether NextEra is overpaying at a time when utility valuations are already elevated from the AI demand wave. Erste Group downgraded NEE to Hold from Buy, citing sharply rising long-term liabilities and interest rate pressure. Long-term debt is not small here.

Regulatory approval in multiple states is also not a rubber stamp. The deal would need to clear federal reviews and state utility regulators, including in Florida, Virginia, North Carolina, and South Carolina. The companies have indicated a 12- to 18-month timeline, and some coverage has suggested the closing is not expected until 2027.

Bull, Base, Bear

• Bull: Regulatory approval sails through on the back of AI power demand arguments, and the stock re-rates toward Morgan Stanley’s $117 target as execution proves out
• Base: Deal closes within the companies’ 12- to 18-month window with manageable concessions, combined entity delivers steady regulated growth, NEE trades in the mid-to-high $90s as the power demand theme continues
• Bear: Regulatory delays push closing deeper into 2028, interest rate pressure weighs on the combined balance sheet, and the AI power demand theme gets disrupted by efficiency gains in compute

The Cheap Investor Scorecard

• 52-week range: $98.75 high; 52-week low reported around the mid-$60s. Current price has been in the high-$80s.
• Dividend yield: high-2% range
• Morgan Stanley price target: $117
• Combined enterprise value post-merger: ~$420 billion
• Deal size: ~$66.8B to ~$67B all-stock, described as the largest utility deal on record
• Next earnings: July 22, 2026 (estimated)

Bottom Line

NextEra just made the biggest bet in utility history. The thesis is simple: AI needs power, and the combined NextEra-Dominion entity is aiming to sit at the center of that demand for decades. The stock pulled back on deal announcement. It has not fully recovered. Earnings are expected July 22.

If you are looking for where regulated, cash-flowing infrastructure meets the AI power wave at a price that is not yet pricing in the upside, this is the conversation worth having before the deal closes.