|Bid||24.00 x 1800|
|Ask||39.00 x 800|
|Day's range||33.04 - 33.84|
|52-week range||19.54 - 41.78|
|Beta (5Y monthly)||1.05|
|PE ratio (TTM)||2.13|
|Earnings date||05 Aug 2020 - 10 Aug 2020|
|Forward dividend & yield||1.20 (3.55%)|
|Ex-dividend date||31 Jul 2020|
|1y target est||44.22|
NRG Energy (NRG) signs a pact to purchase Direct Energy from Centrica PLC for a deal value of $3.625 billion. The acquisition will likely result in 3 million plus retail customer wins.
Centrica Plc on Friday said it was selling its North American subsidiary Direct Energy for $3.63 billion to U.S. integrated power firm NRG Energy, clearing the way for the new head of the British Gas owner to focus on its home markets. The transaction was announced along with Centrica's half-year earnings, where the group reported a profit slump due to the COVID-19 impact and low commodity prices. Centrica's shares ended 16.7% higher, having surged almost 40% early on Friday, and NRG closed up 2.9%.
(Bloomberg) -- NRG Energy Inc. is making its boldest push yet into the retail electricity business, cementing a strategy overhaul that started three years ago.The power supplier said Friday it’s buying Centrica Plc’s Direct Energy unit in a $3.6 billion deal that will nearly double the number of homes and businesses it serves across North America. It’s NRG’s biggest acquisition in eight years.The transaction highlights the extent to which U.S. merchant power producers are seeking to redefine themselves after a surge of new wind and solar energy capacity in the U.S. eroded electricity prices in the wholesale markets. By expanding sales through their retail channels, NRG and peers including Vistra Energy Corp. can reduce their exposure to price fluctuations, stabilize earnings and offer services with higher margins.The deal comes as retail power sales have have remained strong throughout the pandemic, with waning demand from offices and factories offset by booming residential sales, which have greater returns. The U.S. Energy Information Administration forecasts that retail prices will rise 1.2% in 2020 from 2019.“The ‘independent power producer’ label has become an outdated term as NRG and other large power generators have taken on substantial retail supply businesses,” said Travis Miller, an analyst at Morningstar. “NRG is no longer solely a power producer. They are just as much a retail supplier.”NRG’s strategy shift came after activist investors Elliott Management Corp. and C. John Wilder’s Bluescape Energy Partners pressed it to cut costs in 2017 and streamline operations amid sagging profit and stagnant demand for electricity. Chief Executive Officer Mauricio Gutierrez in 2018 described the shift as a “pivot.”The company shed renewable assets as part of that shift. In 2018, it completed one of the largest-ever renewables deals -- a $1.35 billion sale of clean-power assets to Global Infrastructure Partners. That year, Gutierrez told Wall Street that it should begin thinking of the longtime independent power producer in terms of the customers it serves, not the megawatts it produces.By acquiring Direct Energy, which owns no generation plants, NRG will rely more and more on power supplied by third parties through long-term agreements to meet its customers’ needs. The move will allow the company to expand its supply of renewable energy and cut carbon emissions with reduced capital spending, Gutierrez said in a conference call with investors.More CustomersGutierrez calls it a “capital-light renewable PPA strategy,” referring to power-purchase agreements between electric generators and utilities. NRG produces about 23 gigawatts of power, enough to supply a nation the size of Chile or Belgium.The all-cash deal to buy Direct Energy gives NRG 3 million more retail customers in the U.S. and Canada and is expected to generate about $740 million in annual adjusted earnings before interest, taxes, depreciation and amortization, according to an NRG statement. The company plans to pay for the acquisition with a mix of debt, cash and equity-related securities.NRG rose as much as 2.1% Friday before paring gains. The company is down more than 15% this year, which compares to a 6.6% decline in the utility benchmark index.“This is the right transaction at the right time,” Gutierrez said in the conference call with investors. “We want to move closer to the customer. We believe that the mega trends that we’re seeing support that move.”Decisive MoveFor Centrica, the deal is a decisive move by new Chief Executive Officer Chris O’Shea as he seeks to convince investors he can turn the company around after it was demoted from the FTSE-100 U.K. benchmark stock index after 33 years. O’Shea is building on a restructuring announced last month to create a more simple business.In London, Centrica jumped 17%, the most on record during intraday trading.The offer from NRG Energy felt “compelling,” O’Shea said on a call with reporters. “The more you can focus, the better your results can be.”Centrica acquired Direct Energy in 2000. It’s based in Houston, Texas, and says it’s one of the largest residential energy retailers in North America, operating in all 50 U.S. states, the District of Columbia and eight Canadian provinces.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
NRG Energy Inc. (NYSE: NRG) today announced it has entered into a definitive agreement with Centrica PLC under which NRG will acquire Direct Energy, a North American subsidiary of Centrica PLC for $3.625 billion in an all-cash transaction.
On Friday, July 24, 2020 at 9:00 a.m. Eastern Time, NRG Energy Inc. (NYSE: NRG) will hold an investor call to discuss its acquisition of Direct Energy, as announced today by Centrica PLC, as well as a preview of the Company’s second quarter 2020 financial results.
NRG Energy, Inc. (NYSE:NRG) today announced that its Board of Directors declared a quarterly dividend on the Company’s common stock of $0.30 per share, or $1.20 per share on an annualized basis. The dividend is payable on August 17, 2020 to stockholders of record as of August 3, 2020.
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Image source: The Motley Fool. NRG Energy Inc (NYSE: NRG)Q1 2020 Earnings CallMay 7, 2020, 9:00 a.m. ETContents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks: OperatorLadies and gentlemen, [Technical Issues] and welcome to the NRG Energy First Quarter 2020 Earnings Conference Call.
NRG Energy, Inc. (NYSE: NRG) today reported first quarter 2020 income from continuing operations of $121 million, or $0.49 per diluted common share and Adjusted EBITDA for the first quarter of $349 million, cash flow from operations of $208 million and free cash flow before growth of $167 million.
Utility earnings in the first quarter are expected to have benefited from higher residential demand, while milder winter weather conditions could have offset some of the positives.
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NRG Energy, Inc. (NYSE:NRG) plans to report First Quarter 2020 financial results on Thursday, May 7, 2020. Management will present the results during a conference call and webcast at 9:00 a.m. Eastern.