Business Analysis of NRG Energy

 Analyze Historical Performance, Strategic Priorities, And Business Improvement Opportunities of NRG Energy

NRG ENERGY

Business Overview

NRG Energy, Inc., together with its subsidiaries, operates as an integrated power company. The company provides electricity to residential, commercial, and industrial consumers; system power, distributed generation, solar and wind products, backup generation, storage and distributed solar, demand response, energy efficiency, and on-site energy solutions; carbon management and specialty services; and various energy services, such as operations, maintenance, technical, development, and asset management services. It owns and operates approximately 47,000 megawatts of generation. The company also offers retail energy, portable solar, and battery products home services; and various bundled products, which combine energy with protection products, energy efficiency, and renewable energy solutions, as well as other distributed and reliability products. It serves approximately 2.8 million mass recurring customers. In addition, the company owns, operates, and develops solar and wind power projects; develops, constructs, and finances a range of solutions for utilities, schools, municipalities, and commercial markets; provides residential solar and electric vehicle services; and trades in electric power, natural gas, and related commodity and financial products, including forwards, futures, options, and swaps, as well as oil and weather products. As of December 31, 2016, it operated 85 fossil fuel and nuclear plants. Further, the company transacts and trades in fuel and transportation services; directly sells energy, services, and products and services to retail customers under the NRG, Reliant, and other names; and provides steam, hot water, and chilled water, as well as electricity to commercial businesses, universities, hospitals, and governmental units. NRG Energy, Inc. was founded in 1989 and is headquartered in Princeton, New Jersey.

NRG Energy

NRG Energy


R&P Rank: 229
Sector: Utilities
Industry:Electric Utilities
H.Q Location:New Jersey
Website: www.nrgenergy.com
Company Address:
804 CARNEGIE CENTER, -, PRINCETON NJ 08540
Ph:609-524-4500

Business Analysis of NRG Energy

The Utilities Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how NRG Energy compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by NRG Energy to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.

Here is the performance snapshot of NRG Energy with an interactive chart.

  1. Revenue Growth: NRG Energy reported a revenue growth of -15.8% year-on-year during 2016. Electric Utilities Industry grew at 0.2% in the same period
  2. COGS share of Revenues: As a percentage of revenue, NRG Energy spent 69.3% of its total revenues on COGS. Electric Utilities industry average (COGS share of revenue) in the same period was 64.7%
  3. R&D share of Revenues: As a percentage of revenue, NRG Energy spent 0.7% of its total revenues on R&D. Electric Utilities industry average R&D spending in the same period was 0.1%
  4. SG&A share of Revenues: As a percentage of revenue, NRG Energy spent 8.9% of its total revenues on Sales, Marketing, and General Administration (SG&A). Electric Utilities industry average SG&A spending in the same period was 1.2%
  5. Inventory share of Revenues: As a percentage of revenue, NRG Energy spent 9.0% of its total revenues on Inventories. Electric Utilities industry average Inventory spending in the same period was 7.6%
  6. Accounts Payable share of Revenues: As a percentage of revenue, NRG Energy invested 7.2% of its total revenues on Accounts Payable (A/P) Electric Utilities industry average Accounts Payable investment in the same period was 11.9%
  7. Accounts Receivable share of Revenues: As a percentage of revenue, NRG Energy invested 9.4% of its total revenues on Accounts Receivable (A/R). Electric Utilities industry average Accounts Receivable investment in the same period was 14.5%
  8. PP&E share of Revenues: As a percentage of revenue, NRG Energy invested 145.0% of its total revenues on Property, Plants, and Equipments (PP&E). Electric Utilities industry average PPE investment in the same period was 286.7%
  9. Intangibles share of Revenues: As a percentage of revenue, NRG Energy invested 21.8% of its total revenues on Intangibles. Electric Utilities industry average Intangibles investment in the same period was 22.3%
  10. Net Margins: NRG Energy Net Margins in the year 2016 were -6.3%. Electric Utilities industry average Net Margins in the same period were 3.3%

Sector and Industry Association of NRG Energy

For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries.

NRG Energy is associated with Utilities Sector and Electric Utilities Industry.

Utilities sector is comprised of the following industries: Electric Utilities; Gas, Water, & Multiutlities. The definitions for each of the industries is as follows:

  • Electric Utilities industry includes companies engaged in generation, transmission, and/or distribution of electric energy for sale.
  • Gas, Water, & Multiutlities industry includes companies engaged in transmission and/or storage of natural gas for sale and those engaged in distributing water for sale for domestic, commercial, and industrial use. It also includes companies with significant presence in more than one utility.

Industry Ranking of NRG Energy

With $12.4 billion revenues, NRG Energy ranked number 6 of all the companies in the US Electric Utilities industry. There were a total of 33 public companies in the US Electric Utilities industry that had revenues greater than $50 million during 2016.

The top-10 companies in the US Electric Utilities industry by revenues during 2016 were:

  1. Southern ($19.9 billion)
  2. American Electric Power ($16.4 billion)
  3. NextEra Energy ($16.2 billion)
  4. FirstEnergy ($14.6 billion)
  5. AES ($13.6 billion)
  6. NRG Energy ($12.4 billion)
  7. Edison International ($11.9 billion)
  8. Dominion Resources ($11.7 billion)
  9. Entergy ($10.8 billion)
  10. DTE Energy ($10.6 billion)

Business Model Analysis (BMA) Framework

We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.

Next Steps

  • Conduct a holistic benchmarking; to identify and target additional sources of value
  • Get in touch with us to learn more about Business Model Analysis Framework
  • Get free data, charts, and analysis of NRG Energyand its peers on select key performance indicators by clicking the reports provided below

Industry Peers and Competitors of nrg-energy

NextEra Energy (NEE) Business Analysis – Analyze Historical Performance, Strategic Priorities,...

NextEra Energy Inc with $16 billion revenues in the year 2016 was the number 3 Electric Utilities company. Read this report to know the top competitors of NextEra Energy and identify growth and cost optimization opportunities of NextEra Energy

FirstEnergy (FE) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

FirstEnergy Corp with $15 billion revenues in the year 2016 was the number 4 Electric Utilities company. Read this report to know the top competitors of FirstEnergy and identify growth and cost optimization opportunities of FirstEnergy

AES (AES) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

AES Corp with $14 billion revenues in the year 2016 was the number 5 Electric Utilities company. Read this report to know the top competitors of AES and identify growth and cost optimization opportunities of AES

Edison International (EIX) Business Analysis – Analyze Historical Performance, Strategic Priorities,...

Edison International with $12 billion revenues in the year 2016 was the number 7 Electric Utilities company. Read this report to know the top competitors of Edison International and identify growth and cost optimization opportunities of Edison International

Dominion Resources (D) Business Analysis – Analyze Historical Performance, Strategic Priorities,...

Dominion Resources Inc with $12 billion revenues in the year 2016 was the number 8 Electric Utilities company. Read this report to know the top competitors of Dominion Resources and identify growth and cost optimization opportunities of Dominion Resources

Entergy (ETR) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Entergy Corp with $11 billion revenues in the year 2016 was the number 9 Electric Utilities company. Read this report to know the top competitors of Entergy and identify growth and cost optimization opportunities of Entergy

Revenues Analysis

NRG Energy (NRG) Revenues And Revenue Growth From 2012 To 2016

This report provides the last five years revenues and revenue growth of NRG Energy, Inc. (NRG) from 2012 to 2016. NRG Energy generated a total of $12.4 billion revenues during 2016. NRG Energy reported a revenue growth of -15.8% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

NRG Energy (NRG) Revenues And Revenue Growth From 2004 To 2016

This report provides the last thirteen years revenues and revenue growth of NRG Energy, Inc. (NRG) from 2004 to 2016. NRG Energy generated a total of $12.4 billion revenues during 2016. NRG Energy reported a revenue growth of -15.8% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

NRG Energy (NRG) Revenue Growth Comparison With Industry Growth From 2012...

This report provides a comparison of NRG Energy, Inc. (NRG) revenue growth with Electric Utilities industry growth during the last five years from 2012 to 2016. NRG Energy reported a revenue growth of -15.8% year-over-year during 2016. The Electric Utilities industry growth was 0.2% year-over-year during 2016. NRG Energy growth was slower than the industry during 2016.

Profit Analysis

NRG Energy (NRG) Net Profit And Net Margin From 2012 To...

This report provides the last five years net profit and net margin of NRG Energy, Inc. (NRG) from 2012 to 2016. NRG Energy reported a total net income of -$774 million during 2016. NRG Energy generated a total of $12.4 billion revenues during 2016. NRG Energy net profit margin was -6.3% during 2016. The net profit and the net profit margin correspond to the fiscal year ending in December.