Vistra Outperforms Industry in the Past Month: How to Play the Stock?

Shares of Vistra Corp. VST have gained 2% in the past month against the Zacks Utility- Electric Power industry’s decline of 4.8% and the Zacks Utilities sector’s drop of 3%. 

Vistra’s shares have gained on the back of two positive developments. The company signed a definitive agreement to acquire Cogentrix Energy, which includes 10 modern natural gas-fired power plants with a combined capacity of about 5,500 MW, for a net purchase price of roughly $4 billion.

Vistra also signed a 20-year power purchase agreement to supply more than 2,600 megawatts (“MW”) of zero-carbon electricity from three of its nuclear facilities to support Meta’s regional operations.

Price Performance (One Month)

Another utility, Duke Energy DUK, also produces a substantial volume of clean energy from its nuclear generation assets. Duke Energy’s shares have gained 0.6% in the past month.

Should you consider adding VST to your portfolio only based on positive price movements? Let’s 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 Contributing Toward VST Stock’s Performance

Vistra’s long-term 2,600 MW power supply agreement with Meta enhances earnings visibility by locking in stable, contracted revenues from a high-quality customer. The company will supply electricity from its nuclear power units. The long-term agreement supports consistent cash flows and highlights Vistra’s capability to reliably serve fast-growing data-center demand, improving asset utilization and returns while positioning it to capture sustained load growth fueled by AI and cloud expansion.

Vistra has entered into a definitive agreement to acquire Cogentrix Energy, comprising 10 modern natural gas-fired power plants with nearly 5,500 MW of total capacity, for a net purchase price of about $4 billion. The acquisition represents Vistra’s second opportunistic expansion of the clean energy generation portfolio, enhancing its capacity to serve growing customer demand across key markets.

Rising demand for clean power across Vistra’s service territories is being driven by the rapid growth of AI-powered data centers and increasing electrification of oilfield operations in the Permian Basin. With 41,000 MW of diversified generation capacity across gas, nuclear, coal, solar and storage, Vistra is well positioned to meet rising commercial and industrial power demand. Its strong asset base and footprint in high-growth markets enable the company to capture long-term growth while playing a leading role in the clean energy transition.

Vistra also plays a key role in the U.S. energy transition by deploying advanced energy storage solutions that enhance grid reliability and support higher renewable penetration. Strategic investments in large-scale battery projects position the company to capture accelerating market demand.

VST’s Estimates Moving Up

The Zacks Consensus Estimate for VST’s 2026 earnings per share indicates year-over-year growth of 64.07% on 34.58% increase in total revenues.

VST’s Sales Estimates

The long-term (three to five years) earnings growth for Vistra is pegged at 11.67%.

VST’s EPS Estimates

Another utility, NextEra Energy NEE, has the capability to produce a large volume of clean electricity and is working to increase the clean generation capacity further from current levels. The Zacks Consensus Estimate for NEE’s 2026 earnings per share implies year-over-year growth of 8.25% on 15.82% increase in total revenues.

VST Stock’s ROE Higher Than Its Industry

VST’s trailing 12-month return on equity (“ROE”) is 64.04%, way ahead of its industry average of 10.47%. ROE, a profitability measure, reflects how effectively a company is utilizing its shareholders’ funds in its operations to generate income.

Vistra’s Capital Return Program

Vistra continues to increase its shareholders' value through the share repurchase program and dividend payments. The long-term power supply agreement with Meta will further strengthen its earnings. 

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. For more details on the VST dividend, click here.

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 20.18X compared with the industry average of 15.36X.

Summing Up

Vistra’s strong nuclear fleet allows it cater to the rising demand for 24x7 reliable clean energy from the data centers. Management’s decision to acquire Cogentrix Energy will further boost its clean energy generation capacity and cater to the rising demand in the service areas. Vistra’s multi-fuel-based electricity production and focus on clean energy production allow it to benefit from the changing energy landscape. 

VST’s sales and earnings per share estimates for 2026 reflect year-over-year growth and its ROE is better than the industry, which makes the stock attractive. It will be a good choice for the existing investors to hold their positions in the Zacks Rank #3 (Hold) stock. 

Given that VST’s shares are trading at a premium valuation, it will be appropriate for the new investors to keep monitoring the stock and wait for a favorable entry point before making 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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