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NRG Energy: What to Expect after Its Q4 Earnings

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NRG Energy’s earnings

NRG Energy (NRG) reported its fiscal 2018 earnings on February 28. The company reported an EPS of $0.87 in 2018, which missed the consensus estimates. NRG Energy reported a loss of $6.79 per share in 2017. The company reported total revenues of $9.47 billion in 2018—compared to $9.07 billion in 2017, which represents an increase of 4% YoY.

NRG Energy stock had a strong run in the last few years. The stock rose almost 60% in the last 12 months and outperformed peer utility stocks (XLU).

NRG

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What drove the rally?

NRG Energy stock rose due to its transformation plan. The plan focused on streamlining NRG Energy’s business and reducing its total debt. The plan also includes asset sales of NRG Yield and the renewables business, which was closed in the third quarter.

According to the plan, NRG Energy has significantly reduced its total debt burden in the last few quarters. In 2018, the debt came down close to ~$6 billion from $17 billion. NRG Energy has repurchased $1.5 billion of shares since March.

NRG Energy posted an adjusted EBITDA of $1.8 billion in 2018, which met the top end of its guidance range. The company has given an adjusted EBITDA guidance range of $1.85 billion–$2.05 billion for 2019, which represents ~8% growth year-over-year.

To learn more, read NRG Energy: Institutional Activity in Q4.

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