Morningstar Rating

Stock Research and Analysis

by Travis Miller

Bulls Say

NRG owns highly valuable wholesale generation assets in power-hungry areas such as New York City, Southern California, and eastern Texas.
Management says it realized almost $500 million of cash flow benefits from its 2012 GenOn acquisition, representing almost one third of the price it paid.
Regardless of natural gas price levels, NRG should benefit from an uptick in economic activity and power use. Read more 

Bears Say

Greenhouse gas emissions caps out of Washington, D.C., could erode profitability at NRG's coal plants.
We project that lackluster power prices and coal plant closures will result in flat earnings for the next three years.
NRG's move into renewable energy faces development risk if costs rise too much or too quickly, or if government incentives fall away. Read more 

Management

Since 2009, CEO David Crane and his management team have made five big moves, all of which have been, or we think will be, value-accretive. NRG spurned a $5.7 billion all-stock takeover bid from Exelon in mid-2008. It bought retailer Reliant Energy   Read more 

Profile

NRG Energy is the largest U.S. power producer with 53 gigawatts of electricity generation, including Edison Mission. Its fleet is concentrated in Texas, California, and   Read more 

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