Evercore: NRG Energy's (NRG.US) stock price hits a new high but is still undervalued; target price raised to $126.

NRG Energy (NRG.US) saw its stock price hit an all-time high on Tuesday, with Evercore ISI raising its target price from $74 to $126 and upgrading its rating from "neutral" to "overweight," believing that the stock is still undervalued compared to its peers even after strong performance in 2024. Evercore analyst Durgesh Chopra stated that NRG Energy's earnings per share growth target exceeds 10% annually, and by 2029, the company plans to return $8.8 billion in capital to shareholders through dividends and buybacks. He added that the company's potential advantages are being underestimated by the market, as NRG Energy is expected to benefit further from increasing electricity demand and higher prices. With the integration of Vivint nearly complete, Chopra stated that the value proposition provided by the business to NRG Energy is evident: since the completion of the transaction in the first quarter of 2023, NRG Energy's customer base has increased by approximately 200,000, revenue per user has increased by about 10%, and already attractive profit margins have further increased by around 100 basis points considering NRG Energy's retention rate of around 90% and optimized pricing strategies, these results should continue to improve. The analyst also noted that NRG Energy announced a partnership with Renew Home and Alphabet Inc. Class C in the third quarter of 2024 to develop a 1 Gigawatt residential VPP in Texas, which will enable NRG Energy to develop energy management solutions for customers through smart thermostats, allowing customers to save money, optimize energy usage, and provide enhanced grid stability.