Irving, Texas-based Vistra Corp. (VST) is a retail electricity and power generation company. It provides electricity and natural gas to residential, commercial, and industrial customers. With a market cap of $46.6 billion, Vistra operates through Retail, Texas, East, West, Sunset, and Asset Closure segments.
The utility giant is expected to announce its fourth-quarter results on Wednesday, Feb. 26. Ahead of the event, analysts expect Vistra to report a non-GAAP profit of $1.07 per share, substantially up from a negative $0.48 per share reported in the year-ago quarter. While the company has missed Wall Street’s bottom-line projections in three of the past four quarters, it has surpassed the estimates on one other occasion. Its adjusted EPS of $5.25 for the last reported quarter surpassed the consensus estimates by a notable 323.4%.
For the full fiscal 2024, Vistra is expected to report an adjusted EPS of $4.48, up 24.8% from $3.59 in fiscal 2023. While in fiscal 2025, its earnings are expected to grow 35.3% year-over-year to $6.06 per share.
Vistra’s stock prices have skyrocketed 236.2% over the past 52 weeks, significantly outperforming the S&P 500 Index’s ($SPX) 22.9% gains and the Utilities Select Sector SPDR Fund’s (XLU) 26.9% returns during the same time frame.
Vistra’s stock prices soared 7.7% after the release of its impressive Q3 results on Nov. 7. The company reported a massive 53.9% year-over-year surge in operating revenues to $6.3 billion, which surpassed the Street’s topline expectations by a substantial margin. Meanwhile, its net income to shareholders observed a staggering 295.7% growth compared to the year-ago quarter to $1.8 billion.
VST’s stock rally over the past year is primarily attributable to the growth and the expected growth in energy demand from data centers. However, Vistra’s stock prices plummeted 28.3% in yesterday’s trading session, amid the broader tech selloff on U.S. exchanges. The rise of Chinese DeepSeek AI has unsettled investors’ confidence in the dominance of U.S. firms in the generative AI market. A decline in U.S. dominance in this market would lead to a drop in the energy demand from data centers, which would adversely impact Vistra’s topline growth.
As of writing, analysts remain strongly bullish on the stock’s prospects. VST has an overall “Strong Buy” rating. Out of the 12 analysts covering the stock, 11 recommend “Strong Buy” and one advises a “Moderate Buy” rating. Its mean price target of $184.92 represents a 34.9% upside potential from current price levels.
