Meet the Monster Stock That Continues to Crush the Market
Vista (NYSE:VST)Shares of the S&P 500, one of the largest competitive energy producers in the U.S., are up 530% over the past three years, while the S&P 500 is up only 60%. Let’s see why this energy stock crushed the market and is it still worth buying today?
Vistra has a broad portfolio of natural gas, nuclear, coal, solar and battery energy storage facilities with a total capacity of 44 GW, enough to power 22 million homes. Once Cogentrix Energy completes its acquisition, it expects its capacity to increase to approximately 50 GW.
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Vistra operates the second largest fleet of nuclear power plants in the United States and converts retired coal plants into solar facilities. It expects to reach net-zero carbon emissions by 2050 through the expansion of nuclear and solar power plants.
Its retail business, which includes TXU Energy, Dynegy, Homefield Energy, Ambit and other brands, sells electricity to approximately five million residential, commercial and industrial customers. It offers dozens of renewable energy plans to support net-zero strategies.
Over the past two years, Vistra has expanded its nuclear business with the acquisition of Energy Harbor and its natural gas business with the purchase of natural gas plants from Lotus Infrastructure Partners. The pending acquisition of Cogentrix will further expand its natural gas business.
Vistra’s revenue and adjusted earnings before interest, taxes, depreciation and amortization from 2021 through 2025 (EBITDA) grew at CAGRs of 10% and 32% respectively. This growth was driven by acquisitions and the rapid expansion of the power-hungry segment. cloudy and artificial intelligence markets. Even as it expanded, it bought back about 11% of its shares in the last three years. Its forward yield of 0.6 percent won’t attract any income investors, but its low payout ratio of 41 percent gives it plenty of room for future dividend increases.
From 2025 to 2028, analysts expect Vistra’s revenue and adjusted EBITDA to grow at CAGRs of 13% and 16%, respectively, as energy demand exceeds available supply. Earlier this year Vista agreed to provide: Meta Platforms Thousands of megawatts of nuclear power over the next two decades. More hyperscalers are likely to follow Meta’s lead by entering into similar purchasing power deals.
