Should You Buy NRG Energy Stock Following Impressive Earnings?

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  • NRG Energy stock returned 8% YTD and 25% in May.
  • The company announced robust earnings amidst surging energy prices.
  • NRG stock broke a crucial resistance and targeted higher zones.

NRG Energy, Inc. saw its stock forming a massive resistance that appeared challenging to overpower at $43. The share trades under NYSE: NRG ticker. Meanwhile, the mentioned hurdle remained steady since February 2019. Nevertheless, the stock breached the level in August before plummeting back.

For now, the stock pushes higher after breaching the crucial level. The highs came after NRG retained bullish moves last month, returning over 26%. Moreover, the share returned over 8.12% YTD.

Besides strengths in the energy industry, NRG stock received boosting from its quarterly reports. The company reported $71.7/share net earning early in May. The quarterly reports compare to the $0.33 loss per share in the year before.

The high earnings emerged regardless of the quarter’s revenue hovering around $7.9 billion. A considerable surge in power and natural gas prices enhanced the company’s returns. Moreover, the stock used this as a catalyst to overcome the resistance.

Increases Energy Prices Propel NRG Past Vital Resistance

The technical standpoint reveals NRG stock on a bullish stance after breaking beyond the resistance at $43. Nevertheless, it might not be the time to buy these shares. The Relative Strength Index at 66 shows the stock nearing overbought conditions and might witness a downward correction.

Moreover, historical tendencies show NRG crashes back to its ascending trend-line whenever it touches a new zone. For now, the stock displays some hurdles at $47 and might correct further. Analysts suggest purchasing lower towards the mentioned ascending trend-line.

Final Thought

NRG Energy stock exhibits bullishness as energy prices maintain elevated levels. However, it’s not the time to invest in these shares. The NRG stock might see corrections towards an ascending trend line.

Therefore, investors can wait to buy lower. Potential energy price declines in the coming days/weeks/months are another warning for long-term holders to consider.

What are your thoughts about the information above? Feel free to leave a reply in the comment section below.

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