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

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NRG Energy (NRG - Free Report) ended the recent trading session at $99.80, demonstrating a +2% change from the preceding day's closing price. This change outpaced the S&P 500's 0.58% gain on the day. On the other hand, the Dow registered a gain of 0.69%, and the technology-centric Nasdaq increased by 1.05%.

Coming into today, shares of the power company had lost 4.78% in the past month. In that same time, the Utilities sector gained 1.81%, while the S&P 500 gained 0.97%.

The investment community will be closely monitoring the performance of NRG Energy in its forthcoming earnings report. On that day, NRG Energy is projected to report earnings of $3.4 per share, which would represent year-over-year growth of 23.64%. Meanwhile, the latest consensus estimate predicts the revenue to be $7.34 billion, indicating a 3.93% decrease compared to the same quarter of the previous year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $8.53 per share and a revenue of $36.89 billion, indicating changes of +5.7% and +20.12%, respectively, from the former year.

Investors should also pay attention to any latest changes in 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 business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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. Within the past 30 days, our consensus EPS projection has moved 0.97% lower. Currently, NRG Energy is carrying a Zacks Rank of #5 (Strong Sell).

Valuation is also important, so investors should note that NRG Energy has a Forward P/E ratio of 11.48 right now. This indicates a discount in contrast to its industry's Forward P/E of 17.17.

The Utility - Electric Power industry is part of the Utilities sector. Currently, this industry holds a Zacks Industry Rank of 101, positioning it in the top 42% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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