Utility Stock Plummets on New Acquisition

NRG Energy will acquire Vivint Smart Home for $12 per share

Deputy Editor
Dec 6, 2022 at 11:53 AM
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NRG Energy Inc (NYSE:NRG) stock is plummeting today, down 14% at $35.10 at last glance, after news that the utility name will acquire Vivint Smart Home (VVNT) for $12 per share, or $5.2 billion -- including $2.8 billion in cash transaction and $2.4 billion in debt. VVNT is moving the opposite direction after the news, up roughly 32%.

NRG is receiving plenty of attention in the options pits amid the deal, with overall options volume running at 14 times the intraday average. The December 35 put is the most popular contract by far, with new positions opening there. It's also worth noting that the stock has landed on the short sell restricted (SSR) list today. 

On the charts, today's drop has NRG dangerously close to its July 20 annual low of $34.91, down 18.2% year-to-date. A short-term bounce could be overdue, however, as the stock's 14-day relative strength index (RSI) of 32.5 sits on the cusp of "oversold" territory. 

Analysts are split on NRG Energy, with three of the six firms in coverage carrying a "strong buy" and three a "hold" or worse. Meanwhile, short interest represents 6.5% of the stock's available float, and would take over six days to cover, at the security's average pace of trading. 




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