NRG Energy (NRG) agreed on Nov. 9, 2026 to sell six natural gas power plants to LS Power, and the same day posted third-quarter adjusted EPS of 4.68 against an analyst estimate of 3.35, a difference of +$1.33, or 39.7%. The sale, the earnings beat and a first look at 2027 all landed together. Management said LS Power made an unsolicited offer, and that the sale lets NRG focus on PJM and ERCOT, cut debt and buy back shares. It said the remaining $1 billion of proceeds is meant for contracted growth opportunities or further debt reduction. Figures are current as of Nov. 10, 2026 and cover the quarter ended Sept. 30, 2026.
Key facts
- Nov. 9, 2026 (earnings line): EPS was 4.68 against an estimate of 3.35. Revenue was $9.47B against an estimate of $8.42B, a difference of +$1.04B, or 12.4%.
- Q3 FY2026 (ended Sept. 30, 2026): Revenue was $9.47B, up 24.0% from a year earlier. Net income was $561.0M, up 269.1%. Diluted EPS was 2.59.
- Nov. 10, 2026: The stock traded at 97.11 USD on the latest quote, down 0.30%. Its 52-week range is 79.65-189.96 USD.
- Nov. 9, 2026 (LS Power release): LS Power agreed to buy six gas-fired plants in Connecticut, New York, Rhode Island and Texas, with closing expected in 2027, subject to regulatory approvals.
- Next earnings date: Feb. 23, 2027, with an EPS estimate of 1.94 and a revenue estimate of $8.14B.
| Metric | Q3 FY2026 | Q3 FY2025 |
|---|---|---|
| Revenue | $9.47B | $7.63B |
| Operating income | $1.08B | $422.0M |
| Net income | $561.0M | $152.0M |
| Diluted EPS | 2.59 | 0.69 |
The adjusted EPS of 4.68 in FMP's earnings line is a different measure from the diluted EPS of 2.59 in the income statement. The earnings line is the figure compared against analyst estimates. The income statement figure is the GAAP result after all costs.
What happened
The theme: power demand is rising, and firm power is in focus. Reuters reported on Nov. 10, 2026 that the EIA expects U.S. power demand to beat record highs in 2026 and 2027 as AI use surges. Gas-fired plants that can run on demand, called "firm" or "dispatchable" power, matter because wind and solar output varies. LS Power CEO Paul Segal said that significant investment in firm, dispatchable power "remains essential to grid reliability." Note that NRG is the seller of these gas plants, so the theme is not a pure tailwind for the company.
NRG's concrete example. NRG sells electricity to homes and businesses and owns power plants. It had recently bought a portfolio from LS Power. On Nov. 9, LS Power announced it would buy six plants from NRG. CEO Robert Gaudette said on the call that the agreement is "to sell select generation assets to LS Power for $4 billion," at "8.0x expected 2027 adjusted EBITDA." He also said: "We were not pursuing a sale. LS Power approached us with an unsolicited offer." And: "We believe NRG shares represent exceptional value at current levels, and we intend to act on that conviction."
On the call, management said it expects the sale to close in the second quarter of 2027, pending regulatory approval. Gaudette said NRG is "increasing planned share repurchases by $1 billion, bringing our total across 2026 and 2027 to $3 billion," and plans to begin them in 2026, ahead of the expected closing. Management also said it would put part of the proceeds toward debt reduction to maintain its current leverage position. Its 2027 guidance, introduced for the first time, excludes the sale. Management said it will update that outlook after closing.
The quarter. According to management, results benefited from the acquired LS Power portfolio, higher capacity revenues (payments for keeping plants available), higher retail margins and favorable Texas weather in its home energy business. Smart Home earnings rose on customer growth. By segment, revenue was higher than a year earlier in East, Texas and Vivint Smart Home, and lower in West, Services and Other.
Management also said wholesale power prices in ERCOT, the Texas grid, have run well below its original planning assumption this year. It said its execution kept 2026 near the middle of its guidance. It now expects to finish slightly below the midpoint of its adjusted EBITDA guidance range. It reaffirmed guidance on all four of its financial metrics.
Why it matters for investors
Five-quarter trend. Margins improved after a weak winter, and cash flow turned positive.
| Quarter (ended) | Revenue | Operating margin | Free cash flow |
|---|---|---|---|
| Sept. 30, 2025 | $7.63B | 5.5% | $230.0M |
| Dec. 31, 2025 | $7.75B | 3.2% | -$175.0M |
| Mar. 31, 2026 | $10.30B | 2.5% | -$486.0M |
| June 30, 2026 | $7.48B | 13.0% | $779.0M |
| Sept. 30, 2026 | $9.47B | 11.5% | $571.0M |
Operating cash flow was $1.10B in the latest quarter. Capital spending was higher than the prior quarter. Share buybacks slowed sharply in the latest quarter compared with the two before it, while dividends were roughly in line with the prior quarter at $101.0M.
Balance sheet. FMP reports net debt of $22.98B. Total debt was $23.13B, cash and short-term investments were $148.0M and shareholders' equity was $5.27B, all as of Sept. 30, 2026. Debt/equity is 4.39. The Altman Z score, a bankruptcy-risk gauge where lower is weaker, is 1.49. The Piotroski score, a 0-9 financial health check, is 5. Debt is the reason management's plan to direct sale proceeds to debt reduction matters.
Valuation against peers. On a trailing 12-month basis, NRG has a P/E of 17.07, a net margin of 3.6% and an EV/EBITDA of 10.97. For comparison:
| Company | P/E | Net margin |
|---|---|---|
| NRG | 17.07 | 3.6% |
| Constellation Energy (CEG) | 21.40 | 12.8% |
| AES (AES) | 5.97 | 13.5% |
| Centrica (CPYYY) | 9.61 | 3.6% |
| Talen Energy (TLN) | -63.70 | -6.4% |
NRG's net margin is thin next to Constellation (CEG) and AES (AES). Its P/E sits between the two.
Analysts. FMP lists 28 ratings, with 1 strong buy, 19 buy, 7 hold and 1 sell, for a consensus of "Buy". The analyst price target consensus averages 172.29 USD, with a median of 164.00 USD, a low of 131.00 USD and a high of 221.00 USD. The latest quote of 97.11 USD sits below the low end of that range. Several firms, including CIBC, Scotiabank, Wells Fargo and Barclays, maintained positive ratings in late October 2026. Morgan Stanley kept Equal Weight on Oct. 21. FMP's own discounted cash flow model estimates 198.42 USD per share, a model output, not a forecast from us.
Stock Expert AI MoonshotScore. Our MoonshotScore V2 is 55.1, rated Fair. Sector-relative pillars: valuation 88, quality 86, growth 74, safety 15 and momentum 7. In plain terms, the score says the stock looks inexpensive and scores well on quality, but its price trend and financial cushion are weak. That matches the heavy debt and the stock's distance from its 52-week high.
What could go wrong. Management named several risks:
- Weak ERCOT prices, with 2027 described as a weak period for that market. Management said it has hedged.
- Higher regional carbon-program (RGGI) compliance costs in 2027.
- Older PJM hedges that limit upside next year.
- Regulatory approval for the sale.
- Timing of the financing partner for the first data center project: Bruce Chung, who presented the financial results on the call, said it could slip into the new year, though not far into the first quarter. Gaudette said he fully expects the data center agreement and announcement by year-end.
- Interest expense and depreciation weighing on adjusted EPS growth.
What to watch next
- PJM capacity auction in December: Management expects it to clear at the top of the allowed price range.
- First data center project: Management said it expects an announcement by year-end, with a financing partner targeted around the same time.
- Sale approvals: Management expects closing in the second quarter of 2027, after which it will update its outlook.
- Spring 2027 Texas legislative session: Gaudette said he does not expect the session or the ERCOT batch process to derail the project, and he expects the outcome to favor projects like NRG's.
- Next earnings on Feb. 23, 2027: The EPS estimate is 1.94 and the revenue estimate is $8.14B.
Frequently asked questions
Q: What did NRG Energy announce on Nov. 9, 2026?
NRG Energy (NRG) agreed to sell six natural gas power plants to LS Power, with closing expected in 2027. It also reported third-quarter 2026 earnings (quarter ended Sept. 30, 2026), reaffirmed 2026 guidance and gave its first 2027 outlook, which excludes the sale.
Q: Did NRG beat earnings estimates in the third quarter of 2026?
Yes, according to FMP's earnings line. EPS was 4.68 against an estimate of 3.35, and revenue was $9.47B against an estimate of $8.42B. Diluted EPS under the income statement was 2.59, and net income was $561.0M.
Q: What is NRG's main risk after the asset sale?
Management named weak Texas wholesale power prices, higher compliance costs, regulatory approval for the sale and the timing of its first data center deal. FMP data also shows net debt of $22.98B as of Sept. 30, 2026. Our MoonshotScore rates NRG's safety pillar at 15 and momentum at 7. This is information, not investment advice.
What our data could not verify: Segment-level profit was not available in our FMP data. The sale price and the 2027 guidance midpoints come from the call: $4 billion for the sale, and 2027 guidance midpoints of $5.75 billion adjusted EBITDA, $3.15 billion free cash flow before growth and $9.05 adjusted EPS, excluding the sale. The transcript does not state Bruce Chung's title.
Sources: Stock Expert AI data (FMP financials, estimates, MoonshotScore) is kept separate from third-party material: the LS Power release dated Nov. 9, 2026, the NRG Q3 2026 earnings call transcript dated Nov. 9, 2026, and Reuters reporting dated Nov. 10, 2026.
This is educational content, not investment advice. Past performance does not guarantee future results.