NRG ENERGY INC (NRG)
US6293775085 - Common Stock
We assign a fundamental rating of 5 out of 10 to NRG. NRG was compared to 47 industry peers in the Electric Utilities industry. While NRG seems to be doing ok healthwise, there are quite some concerns on its profitability. NRG may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
NRG had positive earnings in the past year.
In the past year NRG had a positive cash flow from operations.
NRG had positive earnings in 4 of the past 5 years.
Of the past 5 years NRG 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of NRG (3.78%) is better than 80.00% of its industry peers.
NRG has a Return On Equity of 35.60%. This is amongst the best in the industry. NRG outperforms 100.00% of its industry peers.
NRG has a Return On Invested Capital of 3.56%. This is in the lower half of the industry: NRG underperforms 62.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.78% | ||
| ROE | 35.6% | ||
| ROIC | 3.56% |
ROA(3y)4.21%
ROA(5y)10.3%
ROE(3y)27.95%
ROE(5y)76.37%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
NRG has a Profit Margin of 3.19%. This is amonst the worse of the industry: NRG underperforms 86.67% of its industry peers.
The Operating Margin of NRG (2.82%) is worse than 91.11% of its industry peers.
With a Gross Margin value of 15.91%, NRG is not doing good in the industry: 80.00% of the companies in the same industry are doing better.
NRG's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.82% | ||
| PM (TTM) | 3.19% | ||
| GM | 15.91% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-34.28%
GM growth 5Y-20.44%
2. Health
2.1 Basic Checks
NRG has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for NRG has been reduced compared to 1 year ago.
NRG has less shares outstanding than it did 5 years ago.
NRG has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 1.94 indicates that NRG is not a great score, but indicates only limited risk for bankruptcy at the moment.
With an excellent Altman-Z score value of 1.94, NRG belongs to the best of the industry, outperforming 84.44% of the companies in the same industry.
The Debt to FCF ratio of NRG is 8.87, which is on the high side as it means it would take NRG, 8.87 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 8.87, NRG belongs to the best of the industry, outperforming 84.44% of the companies in the same industry.
A Debt/Equity ratio of 4.14 is on the high side and indicates that NRG has dependencies on debt financing.
With a Debt to Equity ratio value of 4.14, NRG is not doing good in the industry: 97.78% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.14 | ||
| Debt/FCF | 8.87 | ||
| Altman-Z | 1.94 |
ROIC/WACC0.47
WACC7.54%
2.3 Liquidity
A Current Ratio of 1.17 indicates that NRG should not have too much problems paying its short term obligations.
NRG's Current ratio of 1.17 is fine compared to the rest of the industry. NRG outperforms 62.22% of its industry peers.
NRG has a Quick Ratio of 1.10. This is a normal value and indicates that NRG is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Quick ratio value of 1.10, NRG is doing good in the industry, outperforming 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 1.1 |
3. Growth
3.1 Past
NRG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 226.15%, which is quite impressive.
NRG shows a decrease in Revenue. In the last year, the revenue decreased by -5.87%.
NRG shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.91% yearly.
EPS 1Y (TTM)226.15%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%34.75%
Revenue 1Y (TTM)-5.87%
Revenue growth 3Y46.9%
Revenue growth 5Y24.91%
Sales Q2Q%-9.1%
3.2 Future
The Earnings Per Share is expected to grow by 60.66% on average over the next years. This is a very strong growth
Based on estimates for the next years, NRG will show a small growth in Revenue. The Revenue will grow by 3.02% on average per year.
EPS Next Y698.03%
EPS Next 2Y186.8%
EPS Next 3Y107.2%
EPS Next 5Y60.66%
Revenue Next Year3.98%
Revenue Next 2Y3.7%
Revenue Next 3Y3.15%
Revenue Next 5Y3.02%
3.3 Evolution
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
NRG is valuated reasonably with a Price/Earnings ratio of 9.42.
75.56% of the companies in the same industry are more expensive than NRG, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.20. NRG is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 12.74, which indicates a correct valuation of NRG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NRG indicates a somewhat cheap valuation: NRG is cheaper than 71.11% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of NRG to the average of the S&P500 Index (23.73), we can say NRG is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.42 | ||
| Fwd PE | 12.74 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NRG is valued a bit more expensive than 77.78% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, NRG is valued cheaply inside the industry as 82.22% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.22 | ||
| EV/EBITDA | 13.71 |
4.3 Compensation for Growth
NRG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
NRG's earnings are expected to grow with 107.20% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.01
PEG (5Y)N/A
EPS Next 2Y186.8%
EPS Next 3Y107.2%
5. Dividend
5.1 Amount
NRG has a Yearly Dividend Yield of 1.83%.
Compared to an average industry Dividend Yield of 3.68, NRG is paying slightly less dividend.
NRG's Dividend Yield is slightly below the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
5.2 History
On average, the dividend of NRG grows each year by 69.83%, which is quite nice.
NRG has been paying a dividend for at least 10 years, so it has a reliable track record.
NRG has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)69.83%
Div Incr Years5
Div Non Decr Years7
5.3 Sustainability
45.48% of the earnings are spent on dividend by NRG. This is a bit on the high side, but may be sustainable.
The dividend of NRG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP45.48%
EPS Next 2Y186.8%
EPS Next 3Y107.2%
NRG ENERGY INC
NYSE:NRG (12/20/2024, 8:04:00 PM)
After market: 90.65 +0.2 (+0.22%)90.45
+1.2 (+1.34%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryElectric Utilities
Earnings (Last)
Earnings (Next)
Inst Owners98.3%
Inst Owner Change1.61%
Ins Owners0.61%
Ins Owner Change-2.09%
Market Cap18.32B
Analysts77.33
Price Target105.19 (16.3%)
Short Float %4.87%
Short Ratio3.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
Dividend Growth(5Y)69.83%
DP45.48%
Div Incr Years5
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)54.92%
Min EPS beat(2)-5.85%
Max EPS beat(2)115.68%
EPS beat(4)2
Avg EPS beat(4)80.25%
Min EPS beat(4)-33.55%
Max EPS beat(4)244.71%
EPS beat(8)2
Avg EPS beat(8)-84.19%
EPS beat(12)4
Avg EPS beat(12)-76.76%
EPS beat(16)7
Avg EPS beat(16)121.62%
Revenue beat(2)0
Avg Revenue beat(2)-22.26%
Min Revenue beat(2)-23.77%
Max Revenue beat(2)-20.75%
Revenue beat(4)1
Avg Revenue beat(4)-10.73%
Min Revenue beat(4)-23.77%
Max Revenue beat(4)5.34%
Revenue beat(8)3
Avg Revenue beat(8)22.11%
Revenue beat(12)7
Avg Revenue beat(12)30.63%
Revenue beat(16)11
Avg Revenue beat(16)41.01%
PT rev (1m)14.42%
PT rev (3m)14.31%
EPS NQ rev (1m)0%
EPS NQ rev (3m)156.32%
EPS NY rev (1m)1.14%
EPS NY rev (3m)23.48%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.05%
Revenue NY rev (1m)1.05%
Revenue NY rev (3m)4.95%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.42 | ||
| Fwd PE | 12.74 | ||
| P/S | 0.65 | ||
| P/FCF | 15.22 | ||
| P/OCF | 11.49 | ||
| P/B | 7.27 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.71 |
EPS(TTM)9.6
EY10.61%
EPS(NY)7.1
Fwd EY7.85%
FCF(TTM)5.94
FCFY6.57%
OCF(TTM)7.87
OCFY8.71%
SpS138.81
BVpS12.44
TBVpS-27.57
PEG (NY)0.01
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.78% | ||
| ROE | 35.6% | ||
| ROCE | 4.84% | ||
| ROIC | 3.56% | ||
| ROICexc | 3.81% | ||
| ROICexgc | 8.12% | ||
| OM | 2.82% | ||
| PM (TTM) | 3.19% | ||
| GM | 15.91% | ||
| FCFM | 4.28% |
ROA(3y)4.21%
ROA(5y)10.3%
ROE(3y)27.95%
ROE(5y)76.37%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-34.28%
GM growth 5Y-20.44%
F-Score8
Asset Turnover1.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.14 | ||
| Debt/FCF | 8.87 | ||
| Debt/EBITDA | 5.12 | ||
| Cap/Depr | 31.48% | ||
| Cap/Sales | 1.39% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 78.38% | ||
| Profit Quality | 134.23% | ||
| Current Ratio | 1.17 | ||
| Quick Ratio | 1.1 | ||
| Altman-Z | 1.94 |
F-Score8
WACC7.54%
ROIC/WACC0.47
Cap/Depr(3y)39.18%
Cap/Depr(5y)41.59%
Cap/Sales(3y)1.41%
Cap/Sales(5y)1.82%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)226.15%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%34.75%
EPS Next Y698.03%
EPS Next 2Y186.8%
EPS Next 3Y107.2%
EPS Next 5Y60.66%
Revenue 1Y (TTM)-5.87%
Revenue growth 3Y46.9%
Revenue growth 5Y24.91%
Sales Q2Q%-9.1%
Revenue Next Year3.98%
Revenue Next 2Y3.7%
Revenue Next 3Y3.15%
Revenue Next 5Y3.02%
EBIT growth 1Y143.38%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year72.81%
EBIT Next 3Y20.97%
EBIT Next 5Y13.48%
FCF growth 1Y1154.17%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y302.78%
OCF growth 3YN/A
OCF growth 5YN/A