Vistra Outperforms Industry in a Year: How to Play the Stock?

Shares of Vistra Corp. VST have risen 25.6% in the past year compared with the Zacks Utility- Electric Power industry’s growth of 24.1%, 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 enhancing business through targeted investments in retail energy, renewable generation and energy storage assets, supporting its transition to a cleaner and more sustainable energy portfolio. Robust residential and commercial demand across Texas, the Midwest and the Northeast, along with strong availability of the nuclear fleet, has enabled the company to address rising electricity needs while continuing to generate long-term value for its stakeholders.

Price Performance (One Year)

Image Source: Zacks Investment Research

Another firm, Constellation Energy Corporation CEG, also produces a substantial volume of clean energy from its nuclear generation assets. CEG’s shares have gained 47.8% in the past year.

Should investors consider adding VST to their portfolios solely based on its strong price performance over the past year? Let’s examine the underlying factors more closely to determine whether this is the right time for investors to initiate or increase their position in the stock.

Key Factors Driving Growth for Vistra Stock

Rising demand for clean electricity in Vistra’s service areas is being driven by the rapid growth of AI-powered data centers and increased electrification in Permian Basin oilfield operations. VST, with a diversified portfolio of 44,000 MW, including gas, nuclear, coal, solar and storage, is well equipped to meet growing commercial and industrial energy needs while supporting long-term growth in the clean energy transition.

Vistra has broadened the Battery Rewards program to incorporate Enphase Energy’s (ENPH) IQ Batteries, further expanding its residential virtual power plant and enhancing grid reliability in Texas. Through TXU Energy, eligible Enphase customers can earn incentives by feeding stored battery power to the grid during peak periods, supporting load management and efficient use of the existing grid infrastructure.

Vistra maintains a strategic and disciplined approach to capital spending, emphasizing the expansion of zero-carbon nuclear generation, growth in solar and battery storage and the optimization of its natural gas fleet to handle peak demand. Lower interest rates further bolster the company’s financial position by cutting borrowing costs and interest expenses.

Vistra operates a fully integrated business model that combines power generation, retail electricity sales and energy storage, underpinned by strong risk management. This approach allows the company to effectively balance supply and demand, mitigate commodity price volatility and deliver stable cash flows with more predictable earnings.

VST’s Rising Earnings and Sales Estimates

The Zacks Consensus Estimate for VST’s revenues for 2026 and 2027 indicates year-over-year growth of 29.99% and 7.19%, respectively.

Image Source: Zacks Investment Research

The same for VST’s earnings per share for 2026 and 2027 implies year-over-year growth of 65.59% and 26.07%, respectively. Long-term (three to five years) earnings growth is currently pegged at 18.89%.

Image Source: Zacks Investment Research

Vistra Increases Shareholder’s Value

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

Its board of directors has approved an additional $1 billion for share repurchases. As of Feb. 26, 2026, $1.8 billion remained under the current authorization, which the company expects to fully utilize by the end of 2027.

VST’s management is targeting a dividend payment of $300 million annually. The company has raised dividends 17 times in the past five years. To know about VST’s dividend history, click here.

Constellation Energy also distributes dividends and its management has approved a dividend increase of five times in the past five years.

VST Stock’s ROE Is Higher Than Its Industry

Return on equity (“ROE”), a profitability measure, reflects how effectively a company is utilizing the shareholders’ funds in its operations to generate income.

VST’s trailing 12-month ROE is 81.09%, way ahead of its industry average of 10.82%. The company’s better ROE than the industry indicates that it is utilizing funds more efficiently than peers to generate returns.

Image Source: Zacks Investment Research

VST Stock Is Trading at a Discount

Vistra is currently trading at a premium valuation compared with the industry. Its forward 12-month price-to-earnings (P/E) ratio is 15.94X compared with the industry average of 16.19X.

Image Source: Zacks Investment Research

Summing Up

Vistra is strategically positioned to capitalize on the rising demand for clean electricity across its markets. The company’s diversified, multi-fuel generation portfolio and focus on cleaner energy sources align with the shifting energy landscape, and continued investments in clean energy assets enhance its long-term growth potential.

VST stock is currently trading below industry peers, making it an attractive option for investors. With rising sales and earnings-per-share projections, along with a strong ROE, the utility presents a compelling case for potential portfolio addition. VST currently has a Zacks Rank #3 (Hold).

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

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.

Free: See Our Top Stock And 4 Runners Up

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Constellation Energy Corporation (CEG): Free Stock Analysis Report

Vistra Corp. (VST): Free Stock Analysis Report

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

Zacks Investment Research