Valued at $22.8 billion by market cap, NRG Energy, Inc. (NRG) engages in the production, sales and delivery of energy and energy products & services to residential, industrial and commercial consumers in major competitive power markets in the United States. The Houston-based utilities major is expected to announce its fourth-quarter results on Wednesday, Feb. 26.
Ahead of the event, analysts expect NRG to report a non-GAAP profit of $1.06 per share, down 7% from $1.14 per share reported in the year-ago quarter. While the company has surpassed Wall Street’s earnings projections twice over the past four quarters, it missed the estimates on two other occasions. Its adjusted EPS for the last reported quarter increased 14.2% year-over-year to $1.85, missing the consensus estimates by 9.8%.
For the full fiscal 2024, NRG is expected to report an adjusted EPS of $6.36, up a staggering 47.2% from $4.32 in fiscal 2023. While in fiscal 2025, its earnings are projected to grow 18.4% year-over-year to $7.53 per share.
NRG stock has soared 79.7% over the past 52-week period, significantly outpacing the S&P 500 Index’s ($SPX) 22.9% gains and the Utilities Select Sector SPDR Fund’s (XLU) 26.9% returns during the same time frame.
NRG Energy’s stock prices observed a marginal drop after the release of its mixed Q3 results on Nov. 8. Although its revenues dropped 9.1% year-over-year to $7.2 billion, it surpassed Wall Street’s topline expectations by a notable margin. Meanwhile, its adjusted net income increased 9.2% year-over-year to $393 million, which missed the Street’s expectations. However, the company raised its full-year adjusted EBITDA guidance to $3.5 billion - $3.7 billion from the previously announced $3.3 billion - $3.6 billion range, which mitigated the drop in stock prices. Furthermore, the company continues to look for expansion and adding new capacity to its portfolio.
The consensus opinion on NRG stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the nine analysts covering the stock, six recommend a “Strong Buy” and three advocate a “Hold” rating. Its mean price target of $111.75 indicates a 14.6% upside potential from current price levels.
