Vistra is no ordinary utility. Its stock is off to a big 2025 already

Published Fri, Jan 3 20253:56 PM ESTUpdated Fri, Jan 3 20254:35 PM EST

Vistra Corp. has entered the new year with a running start after closing out 2024 as one of the best-performing stocks in the market. The independent power producer's shares have jumped 18% since Tuesday, after more than tripling in value last year. Vistra ended 2024 as the second-best performing stock in the S & P 500 behind Palantir , an unusually strong run for a relatively obscure power company. Vistra is viewed by investors as a nimble power company that is well positioned to quickly serve surging electricity demand from data centers and artificial intelligence. Investors are anticipating that Vistra will soon strike lucrative nuclear and gas deals with data center developers. Wall Street analysts still see upside of nearly 8% for Vistra from current levels with an average price target of $171 per share, according to FactSet data. VST 1Y mountain Vistra shares over the past year. Vistra is one of a trio of power stocks that surged in 2024 because investors believe they are uniquely exposed to the data center demand trend. Constellation Energy nearly doubled last year while Talen Energy more than tripled. Vistra has had the strongest run of the three, despite the fact that the company is the only one that has not struck a deal yet. Talen Energy blazed the trail with an agreement to power an Amazon data center with the Susquehanna nuclear plant. Constellation inked a landmark power agreement with Microsoft to support the restart of Three Mile Island. The three stocks frequently move in sympathy with one another. Vistra shares surged this week after Constellation announced $1 billion in combined contracts to supply the federal government with nuclear power . "You're going to see deals announced in the near term, but who will announce it is less of a factor to me, because they will all move the sector higher whoever announces it," Shahriar Pourreza, head of power and utilities at Guggenheim Securities, told CNBC last month . "I like Vistra because I don't have to bet whether the next deal is going to be a nuclear plant or it's going to be a gas plant," Pourreza said.