FPL Group Inc. (FPL), which provides power in Florida as well as generating wind power across the U.S., easily beat first quarter estimates by 15.38% as its alternative energy segment was strong. The company also recently raised 2009 guidance. FPL has a forward P/E of 11.4.

Company Description

FPL Group is an energy company generating approximately 39,000 megawatts of capacity in 27 states and Canada. The company has two subsidiaries, NextEra Energy Resources, LLC, which generates renewable energy from the wind and sun, and Florida Power & Light Company, which services 4.5 million customers in Florida.

FPL Group also operates the third largest U.S. nuclear power generation fleet.

On May 20, the company announced it was selling $350 million in equity units to Credit Suisse Securities (USA) LLC with the proceeds going to fund investments in power projects, including renewable power projects, and for other general corporate purposes including the repayment of commercial paper.

Each equity unit will have a stated value of $50. Total annual distributions on the equity units will be at the rate of 8.375%, consisting of interest on the debenture and payments under the stock purchase contract.

FPL Group Beat Estimates by 15.38% in the First Quarter

On Apr 28, FPL Group reported first quarter earnings that beat on analysts’ estimates by 12 cents a share. Net income rose 46% to $364 million, or 90 cents, from $249 million, or 62 cents per share, in the year ago period. Analysts expected 78 cents.

NextEra Energy Resources reported strong results while the tough economic conditions hurt Florida Power & Light.

Florida Power saw sales, customers and usage per customer decline year over year even as net income rose 4 cents to 31 cents per share from 27 cents in the year ago quarter.

NextEra, which has generating facilities in 25 states and Canada, had adjusted EPS rise by 13% over the year ago period driven by new investments primarily in wind generation facilities.

Guidance Raised

The company is bullish about 2009 and 2010 and believes that EPS will come in higher than the previous guidance range. For 2009, the new forecast calls for EPS in the range of $4.20 to $4.40 per share. In 2010, the company is expecting a range of $4.65 to $5.05.

Consensus Estimates Rise

Given the first quarter earnings beat and the raising of guidance, covering analysts have been scrambling to raise estimates for the second quarter and the full-year 2009.

Second-quarter estimates jumped 13 cents to 99 cents in the last 30 days. For the full-year, estimates climbed 15 cents to $4.22 per share, which is at the low end of the company’s guidance range as 14 out of 16 covering analysts raised estimates in the last month.

Value Fundamentals

FPL Group is a Zacks #1 Rank (strong buy) stock. It has a forward P/E of 11.39 and a price-to-book of 1.84. The company has a solid 5-year average return on equity (ROE) of 12.78%. As an added bonus, FPL Group also pays a dividend, with a current yield of 3.40%.

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