NRG Energy to Report Q3 Earnings: How to Play the Stock?

NRG Energy NRG is scheduled to release its third-quarter 2025 results on Nov. 6, before market open. The Zacks Consensus Estimate for earnings is currently pegged at $2.26 per share on revenues of $7.16 billion.

Third-quarter earnings estimates have moved up by 23.50% over the past 60 days. The bottom-line projection indicates an increase of 22.16% from the year-ago number. The Zacks Consensus Estimate for quarterly revenues indicates a year-over-year decline of 0.90%.

NRG Stock’s Earnings Surprise History

NRG Energy’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed in one quarter, with the average surprise of 26.22%.

What the Zacks Model Unveils

Our proven model does not predict an earnings beat for NRG Energy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you can see below.

NRG Energy, Inc. Price and EPS Surprise

NRG Energy, Inc. price-eps-surprise | NRG Energy, Inc. Quote

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

NRG’s Earnings ESP: NRG Energy has an Earnings ESP of 0.00%.

Zacks Rank of NRG: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Some companies in the same sector with the right combination of the two factors for an earnings surprise this season are Duke Energy Corporation DUK, having an Earnings ESP of +1.63% and a Zacks Rank #2, and Alliant Energy Corporation LNT, having an Earnings ESP of +0.43% and Zacks Rank of 3.

Factors Likely to Have Shaped NRG Stock’s Q3 Earnings

NRG served a diverse customer base, with no single customer accounting for more than 10% of its total revenues. Courtesy to its high-quality services, the company has maintained strong customer retention, which ensures steady revenues and is likely to have a positive impact on third-quarter earnings.

NRG Energy has been expanding operations through strategic acquisitions and the contributions coming in from the acquired assets are likely to have boosted third-quarter earnings. The company has also been gaining from the increasing demand for reliable, clean power from data centers.

Free cash flow generation capacity allows the company to continue to buy back its shares, which reduces the outstanding share volume and has a positive impact on the bottom line.

NRG Stock’s Price Performance

NRG’s shares have gained 44.6% in the past six months compared with the Zacks Utility – Electric Power industry’s rise of 7.6%.

NRG Stock Returns Better Than Its Industry

NRG Energy’s trailing 12-month return on equity (“ROE”) is 88.22%, ahead of the industry average of 10.35%. ROE is a financial ratio that measures how well a company uses its shareholders’ equity to generate profits. The company's current ROE indicates that it is using shareholders’ funds more efficiently than peers.

NRG Energy’s Shares Trading at a Premium

The company is currently valued at a premium compared with its industry on a forward 12-month P/E basis. NRG Energy is trading at 18.24X compared with its industry’s 15.3X.

Investment Thesis

NRG Energy has made notable strides in its transformation into an integrated power company by prioritizing customer-centric strategies. Its strong performance has been driven in part by organic growth initiatives.

The company has been trying to slowly lower the proportion of debt in the capital mix for a while. NRG Energy is targeting $3.7 billion debt reduction over 24-36 months from closing to maintain investment-grade credit metrics. This will lower capital servicing expenses and boost the margins of the company.

Rapid expansion of Artificial Intelligence-driven data centers in NRG Energy’s service region is creating fresh opportunities for it over the long term. NRG Energy, with its clean energy generation capacity, will be able to cater to the rising demand from data centers and benefit from the same.

Rounding Up

NRG Energy is expected to benefit from stable demand coming from its diverse customer base and the rising demand from data centers will act as a further tailwind.

The company will gain from the contribution coming in from its organic and inorganic assets, the debt reduction initiatives and buyback of shares will continue to have a positive impact on its earnings.

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This article originally published on Zacks Investment Research (zacks.com).

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