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Why This 1 Value Stock Could Be a Great Addition to Your Portfolio

Zacks Equity Research
·2 min read

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors.

Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term.

Why Investors Should Pay Attention to This Value Stock

Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks.

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NRG Energy (NRG)

NRG Energy Inc. was founded in 1989 and the company is engaged in the production, sale and delivery of energy and energy products and services to residential, industrial as well as commercial consumers in major competitive power markets in the United States. The company has financial and commercial headquarters in Princeton, NJ and operational headquarters in Houston, TX.

NRG boasts a Value Style Score of A and VGM Score of A, and holds a Zacks Rank #3 (Hold) rating. Shares of NRG Energy are trading at a forward earnings multiple of 3.8X, as well as a PEG Ratio of 0.3, a Price/Cash Flow ratio of 3.7X, and a Price/Sales ratio of 0.4X.

Value investors don't just pay attention to a company's valuation ratios; positive earnings play a crucial role, too. Two analysts revised their earnings estimate upwards in the last 60 days for fiscal 2022. The Zacks Consensus Estimate has increased $2.70 to $11.68 per share. NRG has an average earnings surprise of 8.3%.

Investors should take the time to consider NRG for their portfolios due to its solid Zacks Ranks, notable earnings and valuation metrics, and impressive Value and VGM Style Scores.


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NRG Energy, Inc. (NRG) : Free Stock Analysis Report
 
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Zacks Investment Research