Vistra Corp. (NYSE:VST) generates electricity from natural gas, nuclear and other power plants and sells it to homes and businesses. Demand from AI data centers is the main reason investors follow the stock. Vistra ranks third on our list of President Trump and Nancy Pelosi Portfolio: Top 4 Picks. The stock is down about 25% over the past year. Let’s dig deeper and see whether it can rebound.
Why Vistra Stock Is Down
Vistra is down more than a quarter from its 52-week high even though earnings keep growing. Investors worry about Texas, where ERCOT power prices have stayed near $30 a megawatt hour, too low to build new plants, CEO Jim Burke said on the August earnings call. Gov. Abbott also ordered an audit of planned data centers seeking grid connections. The CFO said 2027 EBITDA is trending toward the low end of its range, and longer-term guidance had already missed expectations. Meridian Hedged Equity Fund called Vistra a detractor and kept its confidence. See why the fund held on.
Bull Case: Why AI Data Centers Favor Vistra
Data centers need power that is already built and runs all day, and Vistra owns a lot of it. PJM, the largest U.S. power market, cleared its July capacity auction at the price cap for the third year in a row and fell about 6,800 megawatts short of its reliability target. Hyperscalers are signing long contracts to get the supply. Meta signed a 20-year nuclear deal with Vistra for about 2.6 gigawatts. Amazon signed a 20-year deal for about 1.2 gigawatts at Comanche Peak in Texas. Vistra’s gas plants near data centers can also supply temporary power when grid connections are delayed. See why this makes Vistra more flexible than traditional utilities.
Brown Advisory’s Mid-Cap Growth Strategy said data center customers increasingly want to buy power directly from generators, and it sees the potential for more large deals. Read the letter coverage here. The Department of Energy also confirmed a conditional loan commitment of up to $4.2 billion on Oct 5 to upgrade three Vistra nuclear plants, which adds 433 megawatts and extends their operations by 20 years.
Bear Case
Vistra hedges its power sales, so a spike in electricity prices would not fully reach its earnings. Debt has also been rising, and the pending Cogentrix acquisition will add more. If AI data center demand falls short, long-term earnings forecasts could drop again. The stock fell after Vistra’s long-term guidance missed expectations. Meridian Hedged Equity Fund called Vistra a performance detractor and still kept its confidence. See why the fund held on.
Valuation
Vistra trades at about 17 times forward non-GAAP earnings. That is close to the sector median of about 18 and a little above the stock’s five-year average of about 17. On forward EV/EBITDA, the stock trades at about 10 times against a sector median of about 12. The forward PEG ratio, which pairs the P/E with growth, is 0.50 against a sector median of 2.32. The dividend yield is 0.60% against 3.50% for the sector, so investors own the stock for growth.
Can Vistra Keep Growing?
The long-term nuclear deals with Meta and Amazon give Vistra earnings visibility, and the DoE loan lowers the risk of the nuclear upgrades. Vistra expects the Cogentrix acquisition to close in the second half of 2026. The answer depends on whether AI data center demand holds up and whether debt stays under control. Vistra Corp. has the contracts today, and the next few quarters will show whether the demand follows.
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