RRI Energy Shares Rise, Analyst Upgrades Stock

NEW YORK (AP) — Shares of RRI Energy Inc. jumped on Friday as an analyst upgraded the energy provider based on its attractive share price and low-hedged profile, which could boost the stock as natural gas prices recover.

RRI shares gained 41 cents, or 6.2 percent, to $6.65 in midday trading.

Barclays Capital analyst Gregg Orrill said the company has a number of good things going on. For one, RRI has a stable outlook and a low stock price with potential to grow. Additionally, the company has a "low hedged profile," meaning it hasn't locked down prices for a lot of its natural gas inventory. Orrill said that compared to its peers, this makes the company "the most levered." Orrill expects every $1-per-thousand-cubic-foot increase in the price of natural gas translates to a $2-per-share bump in the stock.

Orrill upgraded his rating for the stock to "Overweight," from "Equal Weight." He also raised his price target to $7.50 from $6.50.