NRG Energy's Growth Potential and Undervaluation: Analyst Raises Price Target to $180

Analyst Ryan Levine from Citi reiterated a Buy rating on NRG Energy with a $180 price target, citing the company's potential for growth and value creation from hyperscaler deals, interconnection capacity sales, and recent acquisitions. The analyst believes the market is undervaluing these opportunities, despite a negative corporate insider sentiment with 101 insiders selling shares in the past quarter.

Citi analyst Ryan Levine has reiterated a Buy rating on NRG Energy (NRG) with a $180 price target, highlighting the company's potential for growth and value creation. Levine cited several factors, including the anticipated value from NRG's 1.2GW hyperscaler deals and the sale of interconnection capacity to smaller datacenters. These deals are expected to contribute approximately $16 per share and around $4 per share, respectively, offering substantial upside compared to current market forwards [2].

Levine's refreshed sum-of-the-parts analysis incorporates recent acquisitions and the expected contribution from gas plants under due diligence. The analyst believes the market is undervaluing these opportunities, supporting the Buy rating with a raised price target of $180. However, the recent corporate insider activity indicates negative sentiment, with 101 insiders selling shares in the past quarter [2].

Despite this, NRG Energy's share price has shown resilience, with a market cap of $31 billion and a P/E of 26 already pricing in much of the future growth. The company's aggressive capital return strategy, with a plan to buy back stock at a rate of $1 billion a year, is a notable factor. However, concerns remain about the company's financial management and capital allocation decisions, particularly its negative cash from operations and free cash flow in 2023 [3].

NRG Energy's strategic positioning to meet AI-driven energy demand, strong cash flow, and undervaluation due to market mispricing make it a stock worth considering, but with caution due to the risks involved. The company's upcoming earnings performance will be closely watched by the investment community, with analysts expecting an EPS of $1.07 for the most recent quarter, marking a 27.7% fall compared to the same quarter of the previous year [4].

References:
[1] https://www.bizjournals.com/houston/news/2025/07/10/nrg-energy-consumer-president-bentley-smart-home.html
[2] https://www.tipranks.com/news/ratings/nrg-energys-growth-potential-and-undervaluation-analyst-recommends-buy-with-raised-price-target-ratings
[3] https://finance.yahoo.com/news/nrg-energy-nrg-bull-case-180513772.html
[4] https://finance.yahoo.com/news/nrg-energy-nrg-dips-more-220003794.html