Stephen Simpson, CFA
Nov. 5, 2014, 11:49 AM
- NRG Energy (NRG +3.5%) enjoys strong gains after Q3 results showed sharply higher earnings and revenues despite a relatively tame summer.
- The gain was led by the retail sector, which posted an $88M gain vs. a $56M loss in the year-ago quarter, driven by higher margins from the acquisition of Dominion Resources’ retail business which closed in April; profit in the wholesale market fell to $147M from $282M in the previous year.
- NRG cut its EBITDA outlook to $3.1B-$3.2B, down from its previous guidance of $3.2B-$3.4B.
- NRG also says it has started construction on a new $150M natural gas fired generation plant in Galveston County with the capacity to power 72K homes at peak demand.
Sep. 9, 2014, 3:25 PM
- FuelCell Energy's (FCEL -10.3%) FQ3 earnings may have been disappointing but that doesn’t take away from the longer-term trends supporting the stock, Cowen analysts say.
- Product sales levels were indeed disappointing at $43.2M, 20% lower Y/Y, but short-term cash and cash equivalent totaled $113M, ~16% of market cap, the firm observes; total backlog rose marginally to ~$350M, but that represents ~50% of market cap, and gross margin of 9.2% was a notable Y/Y increase from 8.4%.
- Investors should watch for any news of additional projects with NRG Energy (NRG -0.9%), which has bought $35M in FCEL shares and extended a $40M loan to help toward completing projects.
- FCEL peers PLUG -4.7% and BLDP -4.2% also are sharply lower.
Jul. 31, 2014, 8:46 AM
- FuelCell Energy (NASDAQ:FCEL) +5.1% premarket on news that NRG Energy (NYSE:NRG) is providing financial assistance, including the purchase of $35M in FCEL common stock and establishment of a new $40M revolving construction and term loan facility to use for project development.
- After the sale of 14.6M common shares to NRG at $2.39/share, NRG now owns ~17M FCEL shares for a total 6% stake.
Jul. 1, 2014, 11:59 AM
- NRG Yield (NYLD +4.6%) says it completed its previously announced acquisition of three right of first offer assets from NRG Energy (NRG -2.4%), and raises its FY 2014 guidance for EBITDA to $410M from $292M and cash available for distribution to $140M as a result.
- NYLD is now targeting an annualized dividend of $1.50/share by Q4, up from $1.20; with a pipeline of nearly 2.1 GW of assets identified by NRG as being eligible for drop-down and the pending acquisition of the 947 MW Alta Wind portfolio, NYLD also raises its five-year target dividend per share compound annual growth rate to 15%-18% from 10%-15%.
Jun. 3, 2014, 12:45 PM
- EPA chief Gina McCarthy says she expects for significant changes in proposed state emission goals before a final rule is issued next year if the individual states show they can’t meet the targets.
- McCarthy says the agency made changes when developing its rules on mercury pollution in 2012 after utilities complained, and says she "wouldn’t be surprised if we made significant” revisions to the carbon proposal.
- McCarthy notes "confusion" around the targeted 30% emission cuts, saying it’s not a goal of the plan but an estimate of what the EPA thinks can be achieved.
- Coal names are broadly lower: WLT -4.4%, ACI -3.7%, ANR -2%, ARLP -1.9%, CNX -1.3%, CLD -0.3%, BTU -0.2%.
- Big utilities are mostly higher: EXC +1.6%, AEP +1%, NRG +0.7%, D +0.5%, XEL +0.4%, SO +0.3%, PEG +0.2%, NEE +0.1%, DUK -0.2%
- ETFs: XLE, XLU, TAN, ERX, KOL, IDU, VDE, OIH, ERY, FCG, VPU, DIG, KWT, GASL, DUG, IYE, GASX, PXJ, RYE, FENY, UPW, RYU, FUTY, FXN, FXU, DDG, SDP
Jun. 2, 2014, 3:31 PM
- Walter Energy (WLT -6.3%) shares aren't helped by the coal producer's statement that new EPA proposals aimed at controlling carbon emissions from U.S. power plants should have no material impact on the company; in fact, WLT is down more than peers: CNX +1.1%, BTU +0.1%, CLD -0.3%, ACI -2.8%, ANR -4.6%.
- Long-term losers also will include electric companies that burn lots of coal - such as American Electric Power (AEP +0.1%), Duke Energy (DUK -0.3%), Southern Co. (SO -0.3%) and NRG Energy (NRG -0.1%) - but stiff regulations have been expected for some time.
- Likely winners include companies that pump natural gas and those that use it as their primary fuel, such as Calpine (CPN +0.3%), and companies that operate nuclear plants that generate little carbon but have been expensive to run, such as Exelon (EXC -1%), hope that their aging plants will become more competitive.
- A reduction in coal-fired capacity would increase utilities' demand for natural gas by 3B-10B cf/day from 22B cf/day now, potential benefiting major natural gas producers like Chesapeake Energy (CHK +2.1%), Cabot Oil & Gas (COG -0.8%) and Range Resources (RRC -0.6%).
- ETFs: XLE, XLU, TAN, ERX, KOL, IDU, VDE, OIH, ERY, FCG, VPU, DIG, GASL, DUG, IYE, GASX, PXJ, FENY, RYE, UPW, FUTY, RYU, FXN, FXU, DDG, SDP
Mar. 11, 2014, 2:19 PM
- NRG Energy (NRG +1.7%) agrees to acquire Dominion Resources' (D -0.2%) retail electric business for an undisclosed sum, in a bid to expand its presence in the northeastern U.S. and Texas.
- Dominion's retail electric business serves more than 600K customers in northern states from Illinois to New York, while its Cirro Energy brand is focused on Texas.
- NRG has made a steady series of deals to boost its retail power business and its collection of power plants; it became the biggest wholesale electric company in the U.S. last year after it acquired GenOn Energy for ~$1.7B, and it is buying coal plants, wind farms and other assets out of bankruptcy from an Edison International subsidiary.
Mar. 11, 2014, 2:08 PM
- Edison Mission Energy wins court approval of a plan to exit Chapter 11 protection through a $2.64B asset sale to NRG Energy (NRG +1.7%) that will give NRG coal-burning power plants in the Midwest that may boost revenue if natural gas prices rebound.
- Edison Mission’s non-bankrupt parent, Edison International (EIX -1%), agreed last month to a nearly $1B settlement that resolved the unit’s tax, pension and other liabilities.
- NRG is paying $2.29B in cash and $350M in stock for the assets; EIX will continue to own what’s left of Edison Mission after the sale.
Nov. 12, 2013, 8:54 AM
- NRG Energy (NRG) -2.8% premarket even after its Q3 earnings report enjoyed a boost from last year's GenOn Energy acquisition.
- For the year, NRG lowered the high end of its previous EBITDA guidance range by $100M to $2.55B-$2.6B; for 2014, EBITDA guidance is cut to $2.7B-$2.9B from its previous estimate of $2.85B-$3.05B, primarily due to the decline in forward curves across core wholesale regions over the past few months as a result of the lack of scarcity pricing during the summer of 2013.
Oct. 25, 2013, 3:34 PM
- Shares of Calpine (CPN +7.1%) and NRG Energy (NRG +6.6%) are up sharply on the session.
- The move looks to be attributable to news that the newest member of the Texas Public Utility Commission would support mandatory reserve margins in order to mitigate potential rolling blackouts in the state.
- "Electricity use in Texas has been growing faster than generation is being built," Reuters notes.
Oct. 18, 2013, 2:51 PM
- NRG Energy (NRG +7.3%) agrees to acquire bankrupt Edison Mission Energy from Edison International (EIX) for $2.635B.
- NRG says the deal increases its generation portfolio by nearly 8K MW, providing additional fuel diversity, geographic diversity and opportunities to achieve economies of scale, and significantly expands the pipeline of assets available to drive growth at NRG Yield (NYLD) through future drop-downs with 1,600 MW of long-term, fully-contracted wind and natural gas assets.
- To fund the deal, NRG files to sell 12.67M common shares.
Sep. 5, 2013, 8:11 AM
- FuelCell Energy (FCEL) +14.6% premarket after reporting better than expected revenue growth and improved margins in its FQ3 results.
- Product sales, which comprise ~85% of revenue, more than doubled to $45.4M.
- Gross margin improved to +8.4% from -9.2%, driven by improved overhead cost absorption from higher production levels and a sales mix that includes power plants along with fuel cell kits.
- FCEL also announced a marketing agreement with NRG Energy (NRG), adding a new sales channel for the marketing and sales of its power plants.
Jul. 17, 2013, 2:17 PM
NRG Yield (NYLD) delivers a strong IPO: after pricing its 19.6M-share offering at $22, shares of the NRG Energy (NRG -0.9%) investment vehicle opened at $26.75 and are currently at $27.29, up 24%. NYLD is promising healthy/reliable dividend payments via profits created by its base of electricity generation/infrastructure assets. (S-1) (IPO preview)| Jul. 17, 2013, 2:17 PM
Jul. 5, 2013, 10:58 AM
Jun. 7, 2013, 9:43 AM
NRG Yield, a unit of power generator NRG Energy (NRG +4.2%), files to raise up to $400M in an IPO of class A shares; it will operate and acquire contracted conventional and renewable power generation infrastructure. The number of shares to be sold or the expected price range are not disclosed.| Jun. 7, 2013, 9:43 AM
Jun. 6, 2013, 3:42 PM
NRG Energy (NRG +1.7%) says it exceeded its post-merger goals for balance sheet efficiencies through a successful repricing of its senior credit facilities and increasing them to $2.5B from $2.3B, plus the previously announced redemption of GenOn's senior notes. NRG expects $49M/year in interest savings beginning in 2014 from the transactions.| Jun. 6, 2013, 3:42 PM