Vistra Outperforms Its Industry YTD: Buy, Hold or Sell the Stock?

Shares of Vistra Corp. VST have rallied 29.9% in the year-to-date period compared with the Zacks Utility- Electric Power industry’s growth of 25.6%, courtesy of its strong retail and commercial operations. Vistra has outperformed the Zacks Utilities sector and the S&P 500 in the same time period.

The company is strengthening operations with targeted investments in retail, renewable energy and storage assets, advancing its shift toward a cleaner and more sustainable portfolio. Strong residential and commercial demand in Texas, the Midwest and the Northeast, combined with high nuclear fleet availability, has helped the company reliably meet growing power needs and generate long-term value for its stakeholders.

Another utility, NextEra Energy NEE, also produces a substantial volume of clean energy from its generation assets. NextEra Energy’s shares have gained 17.5% in the year-to-date period.

Price Performance  (YYD)

Should you consider adding VST to your portfolio only based on positive price movements? Let us delve deeper and find out the factors that can help investors decide whether it is a good entry point to add VST stock to their portfolio.

Factors Acting as a Tailwind for Vistra Stock

Demand for clean electricity is accelerating across Vistra’s service areas, fueled by the surge in AI-driven data centers and the growing electrification of oil field operations in the Permian Basin. Vistra’s strong performance is supported by its ability to produce substantial low and zero-emission power from a diverse portfolio that includes solar, nuclear, natural gas and other alternative energy sources.

The company continues to benefit from a growing residential customer base and a robust hedging strategy that brings clarity to its financial outlook. As of Oct. 31, 2025, Vistra had fully hedged 98% of its expected output for the current year and secured 96% of the projected production for 2026. This proactive risk management approach strengthens financial stability and shields the company from market volatility.

Systematic acquisitions are also boosting market presence and creating more sources of revenues for the company. Vistra’s acquisition of seven modern natural gas generation facilities from Lotus Infrastructure Partners, with a capacity of 2,600 megawatts, will further boost Vistra’s clean energy generation capabilities. 

Vistra is poised to further expand and upgrade its nuclear operations by improving efficiency and managing costs effectively. With a new executive order and faster Nuclear Regulatory Commission approval processes, nuclear projects that previously encountered lengthy delays can now move forward more quickly, giving Vistra a strategic advantage in providing reliable, carbon-free energy.

Mixed Movement in Earnings Estimates for VST

The Zacks Consensus Estimate for VST’s 2025 earnings per share indicates an increase of 3.63% in the past 60 days, while the same for 2026 has gone down 0.24% in the same time period.

VST Stock’s ROE Is Higher Than Its Industry

VST’s trailing 12-month return on equity (“ROE”) is 64.04%, way ahead of its industry average of 9.95%. ROE, a profitability measure, reflects how effectively a company is utilizing its shareholders’ funds in its operations to generate income.

Another company, Constellation Energy CEG, which has a large nuclear fleet, has an ROE of 21.59X, which is better than the industry average. Nearly 60% of Constellation Energy’s total production volume comes from nuclear energy.

Vistra’s Capital Return Program

Vistra continues to increase its shareholders' value through the share repurchase program and dividend payments.

VST’s board of directors has also approved a quarterly dividend of 22.7 cents for the fourth quarter of 2025. Management is targeting a dividend payment of $300 million annually. VST has raised dividends 17 times in the past five years. 

Vistra’s board of directors has approved an additional $1 billion for share repurchases. As of Oct. 31, 2025, $2.2 billion remained under the current authorization, which the company expects to fully utilize by the end of 2027.

VST Stock Is Trading at a Premium

Vistra is currently trading at a premium valuation compared with the industry. Its forward 12-month price-to-earnings (P/E) ratio is 21.74X compared with the industry average of 15.24X.

Summing Up

Vistra is strongly positioned to capitalize on rising clean electricity demand across its service territories. Its solid hedging strategy improves earnings predictability by shielding future generations from market price swings. To support this growth, the company is also expanding its portfolio with additional clean energy assets.

With VST’s shares currently trading at a premium, existing investors may be best served by holding their positions in this Zacks Rank #3 (Hold) stock to continue receiving dividend income, while monitoring for a more favorable entry point before making additional investments.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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