NRG Energy (NRG) AI Stock Analysis

• Market Cap: $28.61B
• Dividend Yield: 1.11%
• Average Volume (3M): 1.61M
• Price to Earnings (P/E): 21.8
• Beta (1Y): 1.67
• Revenue Growth: 6.40%
• EPS Growth: 62.12%
• Country: US
• Employees: 15,637
• Sector: Utilities
• Sector Strength: 65
• Industry: Independent Power Producers
• EPS (TTM): 2.78
• Shares Outstanding: 191,639,400
• 10 Day Avg. Volume: 1,421,168
• 30 Day Avg. Volume: 1,608,798
• PEG Ratio: -0.03
• Price to Book (P/B): 7.50
• Price to Sales (P/S): 0.66
• P/FCF Ratio: 10.13
• Enterprise Value/Market Cap: 1.49
• Enterprise Value/Revenue: 1.43
• Enterprise Value/Gross Profit: 6.97
• Enterprise Value/Ebitda: 11.23
• 1Y Price Target: $201.29
• Price Target Upside: 35.19% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): 9.26
• Revenue Forecast (FY): $35.07B

• Rating: 68 Neutral
• Price Target: $174.00 ▲(16.86% Upside)

The score is driven primarily by solid underlying profitability and improving free cash flow, plus a strong and upbeat earnings-call backdrop with raised guidance and expanding data-center agreements. Offsetting these positives are elevated balance-sheet leverage and only mixed technical momentum, while valuation and dividend support appear average.

Positive Factors

Free cash flow improvement

Sustained 22.5% TTM free cash flow growth and a 0.62 FCF-to-net-income ratio strengthen NRG’s ability to fund capex, integrate acquisitions, and support renewables without immediate equity issuance. Durable cash generation improves strategic optionality and resilience through cycles.

Data-center backlog and raised guidance

A growing data-center contract book (445 MW contracted, 5.4 GW pipeline) plus a $100M guidance raise create a multi-year, structural revenue backlog. This supports recurring high-margin demand for reliable power and underpins longer-term margin and cash flow visibility beyond commodity cycles.

Distributed energy and Smart Home expansion

Partnerships to scale home battery storage and strong Smart Home retention build distributed energy capacity and recurring service revenue. This diversifies NRG away from pure wholesale exposure, taps secular DER growth, and creates durable customer relationships with higher lifetime value.

Negative Factors

High balance-sheet leverage

Very high leverage (debt/equity ~6.15, equity ratio 8.2%) materially limits financial flexibility, raises refinancing and interest-rate risk, and increases vulnerability to downturns. Capital-intensive projects or further acquisitions could strain credit metrics and raise funding costs over the medium term.

Modest, volatile revenue growth

Low (1.4% TTM) and inconsistent revenue growth undermines operating leverage and makes sustained margin expansion harder. Reliance on episodic items and commodity-exposed wholesale revenue increases earnings volatility and complicates long-term planning for renewables scale-up and retail expansion.

Regulatory and regional retail headwinds

Ongoing regulatory changes in PJM, Maryland and New York have structurally pressured retail margins and contributed to East segment declines. Persistent regulatory risk can limit market access, increase compliance costs, and reduce the durability of retail earnings over the medium term.

NRG Energy Business Overview & Revenue Model

Company Description

NRG Energy, Inc., together with its subsidiaries, operates as an integrated power company in the United States. It operates through Texas, East, and West. The company is involved in the producing, selling, and delivering electricity and related products and services to approximately 6 million residential, commercial, industrial, and wholesale customers. It generates electricity using natural gas, coal, oil, solar, nuclear, and battery storage. The company also provides system power, distributed generation, renewable products, backup generation, storage and distributed solar, demand response, and energy efficiency, and advisory services, as well as carbon management and specialty services; and on-site energy solutions. In addition, it trades in electric power, natural gas, and related commodities; environmental products; weather products; and financial products, including forwards, futures, options, and swaps. Further, the company procures fuels; provides transportation services; and directly sells energy, services, and products and services to retail customers under the NRG, Reliant, Direct Energy, Green Mountain Energy, Stream, and XOOM Energy. As of December 31, 2021, it owns and leases power generation portfolio with approximately 18,000 megawatts of capacity at 25 plants. NRG Energy, Inc. was founded in 1989 and is headquartered in Houston, Texas.

How the Company Makes Money

NRG generates revenue primarily through the sale of electricity and related services. Its key revenue streams include wholesale electricity sales to utilities and other power marketers, retail electricity sales to residential, commercial, and industrial customers, and revenue from renewable energy projects. Additionally, NRG earns income from energy management services and solutions, which help customers optimize their energy usage. Significant partnerships with technology and renewable energy firms enhance its service offerings and market reach, contributing to its overall earnings. The company also benefits from regulatory incentives and market demand for cleaner energy sources, which support the growth of its renewable energy initiatives.

NRG Energy Financial Statement Overview

Summary

NRG Energy demonstrates a solid financial performance with stable profitability and cash flow generation. However, high leverage and fluctuating revenue growth rates present potential risks. The company shows strong returns on equity, but the high debt levels require careful management to mitigate financial risks.

Income Statement

NRG Energy's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a modest revenue growth of 1.4%, with a gross profit margin of 20.5% and a net profit margin of 4.8%. The EBIT and EBITDA margins are 8.1% and 12.7%, respectively, reflecting stable operational efficiency. However, the company has experienced fluctuating revenue growth rates over the years, indicating potential volatility in revenue streams.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 6.15 in the TTM period, suggesting significant leverage, which could pose financial risks. However, the return on equity is strong at 60.6%, indicating effective use of equity to generate profits. The equity ratio stands at 8.2%, reflecting a low proportion of equity financing relative to total assets.

Cash Flow

Cash flow analysis shows a positive trend with a 22.5% growth in free cash flow in the TTM period. The operating cash flow to net income ratio is 0.36, and the free cash flow to net income ratio is 0.62, indicating a reasonable conversion of income to cash. However, historical fluctuations in free cash flow growth suggest potential instability in cash generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.78B	28.13B	28.82B	31.54B	26.99B	9.09B
Gross Profit	6.12B	6.03B	2.30B	4.10B	6.51B	2.55B
EBITDA	3.79B	3.50B	1.75B	2.80B	4.18B	1.72B
Net Income	1.44B	1.13B	-202.00M	1.22B	2.19B	510.00M
Balance Sheet
Total Assets	23.97B	24.02B	26.04B	29.15B	23.18B	14.90B
Cash, Cash Equivalents and Short-Term Investments	2.69B	966.00M	541.00M	430.00M	250.00M	3.90B
Total Debt	12.11B	10.99B	10.97B	8.30B	8.29B	9.04B
Total Liabilities	22.00B	21.54B	23.13B	25.32B	19.58B	13.22B
Stockholders Equity	1.97B	2.48B	2.91B	3.83B	3.60B	1.68B
Cash Flow
Free Cash Flow	1.71B	1.83B	-819.00M	-7.00M	224.00M	1.61B
Operating Cash Flow	2.74B	2.31B	-221.00M	360.00M	493.00M	1.84B
Investing Cash Flow	-1.53B	-24.00M	-910.00M	-332.00M	-3.04B	-494.00M
Financing Cash Flow	-1.25B	-1.75B	-400.00M	1.04B	-272.00M	2.20B

NRG Energy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 148.89
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NRG, the sentiment is Negative. The current price of 148.89 is below the 20-day moving average (MA) of 156.85, below the 50-day MA of 163.09, and below the 200-day MA of 149.99, indicating a bearish trend. The MACD of -3.58 indicates Positive momentum. The RSI at 39.82 is Neutral, neither overbought nor oversold. The STOCH value of 18.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NRG.

NRG Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NRG	68 Neutral	$28.61B	21.81	64.19%	1.11%	6.40%	62.12%
FE	67 Neutral	$25.79B	19.40	10.54%	3.94%	7.64%	48.61%
PPL	66 Neutral	$25.59B	23.54	7.65%	3.13%	8.42%	32.48%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
DTE	65 Neutral	$26.98B	19.46	11.64%	3.45%	19.42%	-9.68%
CNP	63 Neutral	$24.74B	23.92	9.61%	2.33%	6.43%	5.07%
VST	59 Neutral	$56.37B	59.43	21.63%	0.56%	42.77%	-47.64%

NRG Energy Corporate Events

NRG Energy Announces Executive Leadership and Board Transition

On January 6–7, 2026, NRG Energy’s board approved a leadership succession plan under which Robert J. Gaudette, currently Executive Vice President and head of NRG Business and Wholesale Operations, was appointed President effective immediately and will become Chief Executive Officer on April 30, 2026, coinciding with the company’s next annual shareholder meeting, when he is also expected to stand for election to the board. As part of the transition, current President, CEO, and Chair Lawrence Coben stepped down from the president role immediately but will remain CEO and board chair until April 30, 2026, then serve as an advisor through year-end, while long-serving director Antonio Carrillo has been designated to assume the role of board chair on that date, signaling a planned, orderly transfer of leadership designed to maintain strategic continuity across NRG’s energy businesses and reassure investors and other stakeholders of stable governance during a pivotal period for the sector.

The most recent analyst rating on (NRG) stock is a Buy with a $240.00 price target. To see the full list of analyst forecasts on NRG Energy stock, see the NRG Stock Forecast page.

NRG Energy announces immediate resignation of board director

On January 2, 2026, NRG Energy, Inc. announced that director Kevin T. Howell resigned from the company’s Board of Directors, effective immediately, to pursue another opportunity. The company emphasized that Howell’s departure did not stem from any disagreement with management, the Board, or the company’s operations, policies, or practices, suggesting a routine leadership change with no sign of internal conflict for stakeholders to infer.

The most recent analyst rating on (NRG) stock is a Buy with a $240.00 price target. To see the full list of analyst forecasts on NRG Energy stock, see the NRG Stock Forecast page.