NRG Energy, Inc. (NRG) Stock Analysis
Score BCyclical · Grade D · Bearish
$123.26
$122.92
-0.3%
5/10
D
Cyclical
Investment Thesis
Price is above modeled value range. Quality supports holding but not attractive for new positions.
Trading near modeled fair value. No strong quantitative signal.
For New Investors
Price above modeled value range
For Current Holders
Quantitative score: neutral
Buy if
- Price drops 15-20% (improves asymmetry)
- Bull scenario catalysts materialize
- Market-wide correction creates opportunity
Sell if
- Bear scenario triggers occur
- Quality metrics deteriorate (ROIC declining)
- Better alternatives emerge
Valuation
Fair Value estimate: $122.92 (-0.3%). Approximately at fair value.
PEG-Based EPS
$184.88
FCF DCF Model
$144.02
EV/EBITDA
$91.00
Blended Fair Value
$122.92
Confidence
Medium
Methods
PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA
Quality Analysis
50/120 points
Low Quality
ROE (3Y Avg)
29.9%
ROIC-WACC Spread
-2.1%
D/E Ratio
10.0x
Current Ratio
1.6x
Interest Coverage
2x
FCF Positive Years
2/3
Quality Flags
- ROIC spread: -2.1pp (got 0/25 pts)
- FCF positive only 2/3 years (13/20 pts)
- Leverage: D/E 10.0x (0/15 pts)
- Interest coverage: 2.4x (7/10 pts)
- Volatile gross margins: std dev 6.9pp (need <3.0pp)
Market Sentiment
Wall Street Consensus
$201.50
+63.5% Upside
17 analysts
Range: $159.00 — $211.00
Rating: Buy
Our model is slightly more cautious than Wall Street.
Trend & Technical
Price ($124.05) is 21.4% below SMA 200 ($157.73). Bearish trend. Caution on entry.
Tech Score 38/100 — FALLING KNIFE. Extreme oversold in bearish trend. High risk — wait for stabilization.
Risk & Reward
Asymmetry Ratio
1.61:1
Expected Return
+5.8%
Bull Upside
+63.2%
Bear Downside
-39.3%
Moderate asymmetry: 1.61:1 ratio. Balanced risk/reward.
Verdict: Neutral
Scenario Analysis
Bear
Base
Bull
Buy Zone & Action Plan
See exact entry zones, stop-loss levels, and a personalized action plan.
AI Executive Summary
Get a detailed AI-written breakdown of the investment thesis, risks, and catalysts.
Technical Analysis
RSI, MACD, moving averages, trend signals, and momentum indicators.
Ask AI about this stock
Chat with our AI analyst to ask questions about valuation, risks, or comparisons.
Frequently Asked Questions
What is the fair value of NRG?
Based on our multi-method conviction analysis, the estimated fair value of NRG Energy, Inc. (NRG) is $122.92. This is calculated by blending PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA and applying a quality premium of 0% based on the company's fundamentals. The confidence level of this estimate is medium.
Is NRG a buy, sell, or hold?
NRG currently has a HOLD rating with a conviction score of 5/10. Price is above modeled value range. Quality supports holding but not attractive for new positions. Price above modeled value range.
Is NRG a high-quality stock?
NRG Energy, Inc. has a quality grade of D (50/120 points), rated as Low Quality. Key metrics include ROE of 29.9%, ROIC-WACC spread of -2.1%, and D/E ratio of 10.0x.
What type of stock is NRG?
NRG is classified as a "cyclical" in our framework. High P/E: 134.8x, Low dividend (reinvesting): 1.5%, Mature growth: 5.6%, High debt: D/E 10.0x, High beta (cyclical behavior): 1.31
What do Wall Street analysts say about NRG?
17 Wall Street analysts have a consensus price target of $201.50 for NRG, representing +63.5% upside. Targets range from $159.00 to $211.00. The consensus recommendation is "Buy". Our model is slightly more cautious than Wall Street.
What are the risks of investing in NRG?
The risk/reward asymmetry ratio for NRG is 1.61:1, rated as Neutral. Moderate asymmetry: 1.61:1 ratio. Balanced risk/reward. The expected return is +5.8%, with bull case upside of +63.2% and bear case downside of -39.3%.
What is the current trend for NRG?
NRG is in a bearish trend. Price ($124.05) is 21.4% below SMA 200 ($157.73). Bearish trend. Caution on entry. The technical score is 38/100.
Related Stock Analyses
Get the complete analysis
Scenario targets, buy zones, action plan, executive summary, technical analysis, and AI chat. All free.
Last updated: May 19, 2026 · Framework version 3.7
This analysis is for informational purposes only and should not be considered financial advice. Always do your own research before making investment decisions.