Update On NRG Energy Inc. (NYSE:NRG)

What a difference a day makes. Last night I posted about NRG Energy Inc. (NYSE:NRG). A company that I’ve been trading for the last month or so. I’ve made some nice gains and I still feel the company’s stock will continue to rise considering the alternative energy needs in this country.
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Something that I did over look in the post is that NRG Energy is in a middle of a hostile take over bid from the country’s largest nuclear power company, Exelon (NYSE:EXC). In October, Exelon offered 0.485 of one of its shares for every NRG share. Many of the NRG investors were not pleased with the offer and stated that Exelon had to raise it’s bid for the independent power producer.
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News came out this morning that the company will raise it’s offer by about 12%. The issue is now is that NRG’s stock price has risen above the offering price from Exelon. So now Analyst are suggesting that it means that Exelon would most likely have to materially raise it’s bid to get NRG shareholders support.
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At the close of last night (July, 2009), Exelon’s stock price closed at $51.56, which puts it’s bid for NRG at $25.01 a share. NRG shares closed at $26.05 yesterday.
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NRG’s stock price opened Thursday at $25.30 and has dropped as low as $24.88. It has bounced back a little, but after today jobless claims and other economic data releases today. I don’t expect any stock to do really good today. We are going into a three day holiday weekend so let the rest of this eek play out on it’s on and see what bargains we’ll have next week.
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Happy Independence Day.

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Tags: Investments, Stock market news, Stock trading

Posted on July 2nd, 2009 in Stock Market News | Leave A Comment »

Nuclear Energy Stocks

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There are many different stocks out there that fall under the term “speculative”, of course that not really the case when it comes to the electric utility stocks. I just want to write about a sector that seems to be building up steam (literally and figuratively) later that needs to be addressed.
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A little over a month ago I started looking for a new speculative stock to trade (oppose to invest in) and I happen to stumble over a company that is in the electric utility sector, but because it is mainly a nuclear play, I thought it would be a decent opportunity. I looked around at other companies that are also trying to expand their nuclear plant output, but this one stuck in my mind.
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I invested a small amount (like I always do on speculative stocks) in the company after reading their earnings reports and reading the transcripts from their conference calls. Since then the stock price has moved up over 30% in just 5 weeks.
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What really made me think that I had to write a post on it, was the fact that the company was profiled on a CNBC special this week titled Nuclear Option. In the show there was a lot of positive talk about the use of nuclear power being used in this country. There hasn’t been a nuclear power plant built in the United States in over thirty years, but now there are two being built as I type this post. One in Texas and the other in Maryland.
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The company that I’m referring to is NRG Energy Inc. (NYSE:NRG). The company looks good to me and I will be buying more of it on the dips. I do expect it to lose some value because of profit takers as well as the overall market taking it down some as the DOW and the economy take a roller-coaster ride throughout the remaining part of the year. The chart looks healthy and with the price of oil expected to go back up, it will continue to rise.
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As with any stock you look to invest in or trade, you need to do your own research to see if it’s right for you.
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Happy Trading.

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Tags: Alternative energy, Earnings report, Economy, Investments, NYSE, Stock investments, Stock market news, Stock trading

Posted on July 1st, 2009 in Investments | Leave A Comment »

Research In Motion (NASDAQ:RIMM)

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Yesterday I spoke about building a position in Research In Motion (NASDAQ:RIMM). My first buy-in was at $76.25 when the price dropped. Share price opened this morning at $77.86 and within the first five minutes of trading, it was up to $78.40. Unfortunately that was as high as it would go. Minutes later it fell to $76.13, where it would continue to bounce within that range.
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Research In Motion was scheduled to release their first quarter earnings report after the closing bell today. I was looking for some more upward motion from other traders getting on board in expectation of RIMM beating the street.
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Shortly after the bell, RIMM released their report. RIMM earned $1.12 per share for the first quarter on revenue of $3.42 billion, compared with $482.5 million or 84 cents on revenue of $2.24 billion a year earlier. Included in the results were non-recurring items. $96.4 million relating to certain employee tax liabilities along with a gain of 175.1 million primarily as a result of the enactment of functional currency tax rules. While the analysts were only expecting $0.94 on revenue of $3.43 billion, RIMM earned $0.98 per share.
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What I didn’t expect was after the company beating expectation by $0.04, the stock dropped more than 6% in after market trading. By the time after hour trading was done, the stock moved back up to $76.06, just off by 0.5% from where it closed at 4:00pm today.
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One thing that I wish I was able to do was to buy more shares when it fell to $73 shortly after the release. In April, Rimm beat expectation by 7% and since then the stock price has moved up 55%. Today they beat it by more than 4% and it moved no where today. Many investors and traders were looking for more and the knee-jerk reaction was to sell. The more they were looking for was in RIMM’s second quarter guidance. RIMM”S range for earning in the next quarter is $0.94 to $1.03 per share on revenue of $3.45-$3.70 billion. The mean analyst estimate is for 97 cents on revenue of $3.61 billion. After the conference call, I guess people realized it wasn’t as bad as it originally sounded.
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With the information I have on this company, I believe that RIMM is still fundamentlly sound and will continue to grow. I will continue to buy into RIMM under $80, after that I will sit back and watch the gains from this great company with a fantastic product. The BlackBerry is a great smartphone with many different applications to do the things you want to do. As a matter of fact RIMM just released their latest BlackBerry model, the Tour, earlier this week.
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Jim Cramer doesn’t call this company one of the four horseman of the tech sector for nothing.

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