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What do Insider Trends Have to Say About NRG Energy, Inc. (NRG)?

Recent insider trends for NRG Energy, Inc. (NYSE:NRG) have caught the attention of investors. Insider activity is often a strong indicator of future performance in a stock, and if the data on NRG is anything to go by, investors should pay attention.

Institutions own 94.03% of NRG Energy, Inc. (NRG)’s shares. The total value of these holdings, in millions, is $8,440. Among active positions in the latest quarter, 173 holders increased their positions by a total of 48.49 million shares, 197 holders decreased the positions by a total of 44.5 million shares, and 54 holders held their positions. This works out to a net increase in ownership of 3.99 million shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 67 holders initiated new positions by a total of 14.21 million shares and 55 holders exited their positions by a total of 3.19 million shares. This nets out to an increase of 11.02 million shares and is a bullish sign for NRG.

In the last three months, insiders executed a total of 16 trades. 16 of these were buys. Insider ownership increased by a total of 4689 shares, which suggests that NRG’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 83 buys and 6 sells, and ownership increased by a net of 1.61 million shares.



Short interest is another tool that analysts use to gauge investor sentiment. It represents the number of a stock’s shares that are being shorted by investors. NRG Energy, Inc. (NYSE:NRG)’s short interest is 21.77 million shares, or % of the float. This represents an increase of 22% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.

In light of the insider ownership and trading data it makes sense to consider technicals to see if they come to a similar conclusion about the outlook for NRG. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that NRG is a Strong buy, which implies that NRG is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that NRG Energy, Inc. (NYSE:NRG) is undervalued.

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