Benzinga - Shares of NRG Energy Inc (NYSE: NRG) spiked in early trading on Monday, after losing more than 22% over the past six months.
Investors seem to have overlooked the earnings potential of the company’s “nuclear plus legacy Texas-centric retail business,” according to BofA Securities.
The NRG Energy Analyst: Julien Dumoulin-Smith upgraded the rating for NRG Energy from Neutral to a Buy, while raising the price target from $35 to $39.
The NRG Energy Thesis: The stock recently fell to its lowest since November 2020 and is trading lower than it was immediately after the Vivint acquisition, Dumoulin-Smith said in the upgrade note.
Check out other analyst stock ratings.
Although the Vivint acquisition is not “the optimal use of capital,” it offers opportunities "to create incremental value via stronger cost control and cross-selling to NRG retail brands that are less price sensitive," the analyst stated.
The Vistra-Energy Harbor transaction also highlights the “latent nuclear+retail value,” which could contribute approximately $1.4 billion in adjusted EBITDA for NRG Energy in 2025, he added.
NRG Price Action: Shares of NRG Energy had risen by 7.56% to $33.86 at the time of publication Monday.
Now Read: Economist Says AI's Impact Exceeds That Of Nuclear Bomb: 'The Genie is Out of the Bottle And It Isn't Going Back In'
Photo: Unsplash
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.