Shares of NRG Energy (NYSE:NRG) are in focus today after the integrated power company announced major management changes and reaffirmed its financial outlook.
Mauricio Gutierrez has departed as NRG’s President and CEO and resigned from the company’s Board. NRG has embarked on a search for a permanent CEO and appointed Lawrence Coben, Ph.D., as its interim President and CEO.
The exit of Gutierrez is something that activist investor Elliott Investment Management had pushed for back in June. At the time, NRG had stood by Gutierrez. However, now the company is cooperating with Elliott and has appointed four new independent directors to its Board.
Further, NRG plans to conduct a comprehensive review of its operations and cost structure to identify opportunities to improve efficiency and enhance capital returns to investors. Additionally, the company reaffirmed its outlook for Fiscal Years 2023 and 2024.
For 2023, it anticipates adjusted EBITDA to be in the range of $3,150 million to $3,300 million. Cash from operating activities is expected to be between $1,750 million and $1,900 million. For 2024, the company expects adjusted EBITDA to be between $3,300 million and $3,550 million. Cash from operating activities during this period is seen landing between $1,825 million and $2,075 million.
The company is also aiming for cost savings of nearly $450 million by 2025 and capital returns of nearly $6.9 billion through 2027.
Is NRG Stock a Good Buy?
Overall, the Street has a Moderate Buy consensus rating on NRG Energy. Following a nearly 51% rally in the company’s shares so far this year, the average NRG price target of $46 implies a potential downside of 4.3% in the stock.
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