Key Takeaways
- Shares of electric utility Vistra finished almost 6% higher on Wednesday, securing the strongest gain in the S&P 500.
- Vistra stock surpassed Nvidia earlier this week as the top-performing stock in the benchmark index year-to-date.
- Analysts at Jefferies and Morgan Stanley boosted their price targets for Vistra stock, citing optimism about data-center opportunities.
Shares of Texas-based power generator Vistra (VST) surged nearly 6% higher on Wednesday, the largest daily gain of any S&P 500 stock. Vistra is no stranger to market-leading upticks, having surpassed Nvidia (NVDA) as the top-performing stock in the benchmark index this year.
Despite the run-up in Vistra’s stock price in 2024, several investment firms suggested there could be more upside potential for shares of the utility company.
In research notes published this week, Jefferies boosted its price target on Vistra shares to $137 from $99, while Morgan Stanley lifted its target on the stock to $132 from $110.
Vision Acquisition, Data-Center Opportunities Drive Positive Outlook
Analysts described catalysts that could help Vistra stock extend its march higher. Jefferies pointed to the firm’s acquisition last week of the remaining 15% noncontrolling interest in its Vistra Vision subsidiary, which includes nuclear generation facilities as well other renewable and energy-storage assets. Analysts equated the Vision deal to buying back shares at a discount.
The report from Jefferies also focused on the recent announcement from fellow electricity generator Constellation Energy (CEG) that it will restart a shuttered nuclear plant to provide power to Microsoft (MSFT) data centers.
The analyst team believes the deal “confirms and expands” their thesis that Vistra stands to benefit from data-center opportunities, while the terms of the 20-year power purchase agreement (PPA) between Constellation and the software giant set a precedent for lucrative agreements in the future.
So far in 2024, Vistra shares have more than tripled in value.