12 High-Growth Utility Stocks to Buy Now

3. NRG Energy, Inc. (NYSE:NRG)

Number of Hedge Fund Holders: 73

Average 5-Year Revenue Growth: 32.31%

NRG Energy, Inc. (NYSE:NRG) is one of the best high-growth utility stocks to buy. On October 20, Jefferies reiterated a Buy recommendation on NRG and increased the price target from $176 to $198. The higher price target factors in potentially larger power and PJM capacity, as well as reduced taxes and cost of financing.

Jefferies remained confident that NRG’s groundbreaking purchase of LS Power portfolio will be approved, and the firm expects an average 2028-2029 EBITDA of $1.9 billion from this acquisition, which brings in a gas generation capacity of 13 gigawatts as well as a demand-side management platform. The investment firm also added that NRG’s Q3 update will shed light on financial results excluding the acquisition.

According to Jefferies, NRG Energy, Inc. (NYSE:NRG) stock offers a potential buying opportunity, as it has a 13% free cash flow yield, which is higher than its industry peers’ mid-single-digit yields. There is also possible upside from data centers, which has not been factored into the stock price.

NRG is a Texas-based integrated energy and home services company operating across the United States and Canada, generating electricity from natural gas, coal, oil, solar, and battery storage.