Back to top

Image: Bigstock

Is NRG Energy (NRG) a Great Value Stock Right Now?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is NRG Energy (NRG - Free Report) . NRG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 7.85, which compares to its industry's average of 14.03. NRG's Forward P/E has been as high as 13.18 and as low as 7.31, with a median of 8.48, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NRG has a P/S ratio of 1.02. This compares to its industry's average P/S of 2.16.

These are only a few of the key metrics included in NRG Energy's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, NRG looks like an impressive value stock at the moment.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


NRG Energy, Inc. (NRG) - free report >>

Published in