This Is Why NRG Energy (NRG) Is a Top Utility Stock on Data Center Growth

NRG Energy, Inc. (NYSE:NRG) is one of the top utility stocks to buy now. On April 13, Jefferies raised its price target on NRG Energy, Inc. (NYSE:NRG) to $199 from $181 while maintaining a Buy rating. The positive stance comes amid expectations that the company will announce a new 1GW combined-cycle gas turbine project.

This is Why NRG Energy, Inc. (NRG) is a Top Utility Stock on Data Center Growth

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The research firm expects the company to announce the gas turbine project with a hyperscaler in the first half of the year as it seeks to capitalize on the AI boom. The company has already secured GEV turbine slots for 5.4 GW of new generation. In addition, Jefferies projects 5.4 GW of data center upside, leading to $1 billion in EBITDA by 2030 and $2.5 billion by 2033.

On the other hand, the company has priced senior secured notes and senior unsecured notes offering due 2031. The company intends to use net proceeds from the offering and the proposed new term loan B of $900 million to repay part of its outstanding borrowings under the NRG revolving credit facility.

NRG Energy, Inc. (NYSE:NRG) is a competitive energy provider and retailer, serving millions of residential and business customers in the U.S. and Canada. The company generates electricity through a diverse portfolio of power plants, including natural gas and renewables, and offers, through its brands, integrated smart home services and retail electricity plans.

While we acknowledge the risk and potential of NRG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NRG and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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