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NRG Energy (NRG) Outpaces Stock Market Gains: What You Should Know

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NRG Energy (NRG - Free Report) closed the most recent trading day at $33.45, moving +0.81% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.57%. Meanwhile, the Dow gained 0.43%, and the Nasdaq, a tech-heavy index, added 0.33%.

Heading into today, shares of the power company had gained 0.48% over the past month, lagging the Utilities sector's gain of 3.48% and the S&P 500's gain of 1.72% in that time.

Investors will be hoping for strength from NRG Energy as it approaches its next earnings release. The company is expected to report EPS of -$0.08, down 132% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $7.97 billion, up 0.91% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.54 per share and revenue of $25.76 billion. These totals would mark changes of +73.28% and -18.34%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for NRG Energy. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 4.12% lower. NRG Energy is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, NRG Energy is currently trading at a Forward P/E ratio of 7.32. Its industry sports an average Forward P/E of 17.2, so we one might conclude that NRG Energy is trading at a discount comparatively.

It is also worth noting that NRG currently has a PEG ratio of 1.13. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Utility - Electric Power industry currently had an average PEG ratio of 2.89 as of yesterday's close.

The Utility - Electric Power industry is part of the Utilities sector. This group has a Zacks Industry Rank of 98, putting it in the top 39% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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