NRG Energy (NRG), valued at a market cap of $8.5 billion, rose the most among its peers in the past year. Currently, NRG Energy is trading at an EV-to-EBITDA valuation of 13x—compared to its five-year historical valuation of ~11x. Utilities at large are trading at an EV-to-EBITDA valuation of ~10.5x. NRG Energy stock appears to be trading at a large premium compared to its peers and its historical average.
The above chart shows that NRG Energy stock significantly outperformed its peers and the broader markets since it introduced a transformation plan in July 2017.
To learn about utilities’ latest performance and how they’re placed in the future, read Why Utilities’ Recent Recovery Might Be Short-Lived.