QS Research · Michael Burry's Scion Capital analyst template · 2006
NRG ENERGY, INC. (NRG)
As of 2026-11-09 · 11/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction medium · base case +128% · downside -50% · upside +174%
At $88.29 the market has $18.56B of equity behind $23.27B net debt, with the quoted TTM EV/EBITDA at 11.4x on $3.68B EBITDA. Base case on the 2027 guidance midpoint: $5.75B x 11.4x = $65.55B EV, less $23.27B net debt = $42.28B equity / 210.21M shares = about $201, +128%. Downside on cycle-normalized EBITDA: about $2.86B x 11.4x = $32.60B EV, less $23.27B net debt = $9.33B / 210.21M = about $44, -50%; TTM is $3.68B, so the normalization is what creates the bear case. The 2026-11-09 $4B asset sale and $3B buyback/$3B debt-reduction plan is a dated re-rating catalyst, but the leverage keeps the downside outside the long rule. Verdict: watch.
Key numbers
- Share price: $88.29
- Market cap: $18.56B
- Latest financial period: TTM to Jun 30, 2026
- Revenue (TTM): $33.12B
- EV / EBITDA (TTM): 11.4x
- P/E (TTM): 23.7x
The 15 boxes
- ○ 1. Long-form business notes
The only usable source is a six-fiscal-year XBRL table (FY2020-FY2025), so these notes are financial-history notes, not a segment or unit-economics description. Revenue moved from $8.69B in FY2020 to $31.49B in FY2022, then $30.35B in FY2025; operating income fell to $384.0M in FY2023 before recovering to $1.84B in FY2025. FY2023 also showed negative pre-tax income, net income to common and operating cash flow, while FY2025 cash, capex and buybacks were all higher than FY2020 and diluted shares were lower.
- ✓ 2. Competitive advantage
The sources do not support a durable competitive advantage. NRG competes in fragmented, rules-heavy retail, wholesale gas, generation, and smart-home markets where customers can switch on offers and market mitigation limits locational pricing power. Its financial history is cyclical: operating income swung from $3.34B in FY2021 to $384.0M in FY2023 and $1.84B in FY2025, while net income to common was -$256.0M in FY2023 and $797.0M in FY2025. No source gives market share, customer retention, unit cost, or ROIC, so scale or brand advantage cannot be established.
- ✓ 3. 10-Q takeaways
The latest 10-Q in the source set is Q2 2026 (quarter ended June 30, 2026): total revenue rose to $7,481M from $6,740M, driven by capacity revenue of $392M vs $61M, while GAAP net income of $506M included unrealized hedge gains and adjusted net income fell to $315M from $339M. Liquidity dropped to $5.3B from $9.6B after the LS Power acquisition, and NRG reaffirmed 2026 Adjusted EBITDA guidance of $5,325-$5,825M and FCFbG of $2,800-$3,300M. Buybacks were $921M in six months 2026 plus $14M through July 31.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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