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NRG Energy (NRG) Exceeds Market Returns: Some Facts to Consider

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In the latest trading session, NRG Energy (NRG - Free Report) closed at $76.43, marking a +1.38% move from the previous day. The stock's performance was ahead of the S&P 500's daily gain of 0.64%. On the other hand, the Dow registered a gain of 1.85%, and the technology-centric Nasdaq increased by 0.2%.

The power company's shares have seen a decrease of 4.02% over the last month, not keeping up with the Utilities sector's loss of 2.06% and the S&P 500's gain of 3.82%.

The investment community will be closely monitoring the performance of NRG Energy in its forthcoming earnings report. The company is scheduled to release its earnings on August 8, 2024. In that report, analysts expect NRG Energy to post earnings of $1.38 per share. This would mark year-over-year growth of 25.45%. In the meantime, our current consensus estimate forecasts the revenue to be $4.59 billion, indicating a 27.75% decline compared to the corresponding quarter of the prior year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $6.63 per share and a revenue of $25.46 billion, signifying shifts of +53.47% and -11.68%, respectively, from the last year.

It is also important to note the recent changes to analyst estimates for NRG Energy. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. NRG Energy is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, NRG Energy is holding a Forward P/E ratio of 11.38. For comparison, its industry has an average Forward P/E of 15.68, which means NRG Energy is trading at a discount to the group.

The Utility - Electric Power industry is part of the Utilities sector. This group has a Zacks Industry Rank of 102, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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