This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

5 Turnaround Stocks That Could Double

Stocks in this article: S TOPS NRG RRC GEN

3. NRG Energy (NRG - Get Report), like GenOn, is an undervalued independent power producer. Its success is similarly dependent upon power demand, which has remained at depressed levels since the recession. Morningstar describes its fleet of coal and nuclear power plants as "ultra low-cost." So, should power demand rebound, which is expected as the economy grows, NRG will see a jump in demand and earnings. It retrofitted plants to burn Powder River Basin coal, a more efficient input, elevating coal-fired margins. Still, Morningstar views this as a risky pick.

Like GenOn, NRG has high "fair-value uncertainty." It trades at a discount to other industry investments because it is subject to a variety of risks. If natural gas prices fail to rise in line with expectations, the economy falters, electricity demand stagnates or Washington imposes new emissions standards, then NRG's shares will drop in value. Further, Morningstar expects margin deterioration through 2012 and then a pickup as growth accelerates. A recent deal to purchase assets from Dynegy fell through when the company rejected a contingent buyout from Blackstone Group.

3 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,445.10 +57.89 0.33%
S&P 500 2,030.41 +0.86 0.04%
NASDAQ 4,694.0560 +12.5590 0.27%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs