NRG Energy (NRG) To Report Q4 Earnings: What's In Store?

NRG Energy, Inc. (NYSE:NRG) will report fourth-quarter 2017 results before the market opens on Mar 1. Last quarter, this company delivered a negative surprise of 33.7%. Let’s see how things are shaping up for this earnings season.

Factors to Consider

NRG Energy announced its ambitious transformation plan in July, which is aimed to save more than $1 billion through recurring cost cuts and margin improvements. In the first nine months of 2017, the cost savings were $92 million and the company is expected to save more during the fourth quarter.

The drop down of assets to NRG Yield and redemption of debts will help the company boost its performance. The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $2,234 million, reflecting 26.7% sequential decline. Additionally, the Zacks Consensus Estimate for the bottom line is pegged at a loss of 8 cents.

Earnings Whisper

Our proven model does not conclusively show that NRG Energy is going to beat estimates this season. This is because it does not have the right combination of two key ingredients. A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks ESP: The company’s Earnings ESP is 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate are both pegged at a loss of 8 cents.

Zacks Rank: NRG Energy carries a Zacks Rank #3. The company’s favorable Zacks Rank when combined with 0.00% ESP lowers the possibility of an earnings beat this season.

Conversely, we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.

Stocks to Consider

Investors can consider the following companies having the right mix for an earnings beat this season.

Fortis Inc. (NASDAQ:CNSL) has an Earnings ESP of +40.0%. It carries a Zacks Rank #3 and is expected to report fourth-quarter 2017 earnings on Mar 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Sunrun Inc. (NASDAQ:RUN) has an Earnings ESP of +45.0%. It carries Zacks Rank #2 and is expected to report fourth-quarter 2017 earnings on Mar 6.

ProPetro Holding Corp. (NYSE:PUMP) has an Earnings ESP of +13.16%. It carries Zacks Rank #2 and is anticipated to report fourth-quarter 2017 earnings on Feb 28.

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