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NRG Energy (NRG) Scales a New 52-Week High on Debt Reduction

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NRG Energy, Inc. NRG reaches a new 52-week high of $35.91 before closing the session a bit lower at $35.62 on Sep 4.

Over the past 52 weeks, NRG Energy’s shares have ranged from a low of $22.90 to a high of $35.90. Average volume of shares traded over the last three months is approximately 4.41 million.

In the past 12 months, the stock has returned about 48.8%, against the industry’s decline of 5.5% and the Zacks S&P 500 composite’s gain of 18.3%.

What's Driving NRG Energy?

NRG Energy delivered an average positive earnings surprise of 213.28% in the trailing four quarters. The Zacks Consensus Estimate for 2018 also moved up 16.2% in the past 60 days.

The company continues to focus on its three years Transformation Plan, which was announced in July 2017. This plan aims to generate $3.2 billion through asset sales. The plan will strengthen earnings, increase cost savings to boost shareholder’s value and strengthen balance sheet. The company has plans to save $500 million in 2018.

Recently, the company sold its interest in NRG Yield,NYLD Inc and Renewables platform to Global Infrastructure Partners. This will help the company focus on its core business.

To reduce interest burden, NRG Energy is working to lower long-term debt. As a result, the company has been able to lower the debt by 5.7% in the first six months of 2018 from the end of 2017. Moreover, the recent segment sale will reduce an additional $6.7-billion debt. This is likely to strengthen balance sheet of the company.

Zacks Rank & Other Stocks to Consider

NRG Energy sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

A few other Atop-ranked stocks in the same industry are DTE Energy Company DTE, and Ameren Corporation AEE. The stocks carry a Zacks Rank #2 (Buy).

DTE Energy delivered an average earnings surprise of 5.69% in the past four quarters. The Zacks Consensus Estimate for earnings moved up 6.8% in the past 60 days.

Ameren Corporation delivered an average earnings surprise of 7.69% in the past four quarters. The Zacks Consensus Estimate for earnings moved up 5.6% in the past 60 days.

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