Evercore ISI Starts NRG Energy (NRG) at Outperform

Evercore ISI analyst Nicholas Amicucci initiates coverage on NRG Energy (NYSE: NRG) with a Outperform rating and a price target of $215.00.

The analyst comments "We are resuming our coverage of NRG Energy, an independent power producer (IPP) possessing >32 GW of generation and commercial virtual power plant (VPP) capacity on a pro-forma basis once accounting for the recently closed acquisition of an LS Power portfolio of assets. The company’s operating assets now consist of ~75% natural gas assets, but more importantly 100% of firm generation, which as we have conveyed in the past (HERE and HERE) is the second most important generation quality in the eyes of large loads, following speed to power which existing assets inevitably provide. The acquisition of the LS Portfolio of assets has only further enhanced NRG’s value proposition, in our view, as it will be immediately accretive to adj. EBITDA, FCF and adj. EPS metrics with incremental upside opportunities through data center retail agreements (1GW+ in the near-term), continued execution of its venture with GEV and Kiewit, and incremental upside from its VPP opportunities. While the upside from a data center deal or further appreciation of power prices are not contemplated within the current guidance, providing attractive upside, we see an incremental upside opportunity for shares through a relatively underappreciated aspect of NRG’s business is its ability to capitalize on VPPs, a value proposition which has seemingly only been enhanced by ERCOT’s Real-Time Co-optimization+Battery (RTC+B) environment, which was officially implemented on December 5th 2025. While the company’s Vivent acquisition was not initially positively received by the market in 1Q23, the company has continued to enhance product offering, increase its customer base (+15% since 3Q23) and its recurring service margin profile (+8% since 3Q23). While this growth has increased the stability of NRG’s margin and earnings profile, we also believe the growth within this business has driven its ability to increase “datapoints” throughout its service territories which should provide incremental value within the context of RTC+B. Resuming at Outperform Rating and $215 price target."

For an analyst ratings summary and ratings history on NRG Energy click here. For more ratings news on NRG Energy click here.

Shares of NRG Energy closed at $184.03 yesterday.

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