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VIstra is Set to Release Q1 Earnings: How to Play the Stock?
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Vistra Corp. (VST - Free Report) is expected to deliver improvements in its top line and its earnings per share when it reports first-quarter 2025 results on May 7, before market open. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
The Zacks Consensus Estimate for VST’s first-quarter revenues is pegged at $4.4 billion, indicating an increase of 44.14% from the year-ago reported figure.
The Zacks Consensus Estimate for VST’s first-quarter earnings is pegged at 54 cents per share, indicating a 134.8% increase from the year-ago reported figure.
Image Source: Zacks Investment Research
Vistra’s Positive Earnings Surprise
Vistra surpassed earnings expectations in one of the last four quarters and missed thrice, with the average surprise being 42.41%.
Image Source: Zacks Investment Research
What the Zacks Model Unveils
Our model does not conclusively predict a likely earnings beat for Vistra this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you can see below.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Vistra has an Earnings ESP of 0.00%.
Zacks Rank: VST currently carries a Zacks Rank #3.
Utilities like Fortis (FTS - Free Report) and MDU Resource Group (MDU - Free Report) have the right combination of factors to come out with earnings surprise this season. The Earnings ESP of Fortis and MDU Resources are currently pegged at +1.22% and +8.33%, respectively. MDU currently sports a Zacks Rank #1 and FTS has a Zacks Rank of 2.
Factors Likely to Have Shaped VST’s Q1 Earnings
Vistra's first-quarter earnings likely benefited from the rising demand for clean electricity within its service region. This growth in demand has been primarily driven by the expansion of large U.S. data centers and the electrification of the Permian Basin. VST’s diversified generation fleet, includes a high-quality nuclear fleet, which allows the company to capitalize on this accelerating load growth and benefit from the same.
VST’s first-quarter earnings is likely to have benefited from the commercial startup of solar and battery facilities at Coffeen and Bladwin, which added over 100 megawatt (MW) to the existing capacity of the company.
The repurchase of shares has been increasing shareholders' value and boosting earnings per share of the company, and is expected to have a positive impact on first-quarter earnings. The company executed $4.6 billion in share repurchases from November 2021 through Nov. 4, 2024, which lowered outstanding shares and boosted earnings per share. VST’s management expects to continue with the buyback of shares and aims to repurchase at least $2 billion worth of outstanding shares between 2025 and 2026, which will definitely have a positive impact on earnings.
Vistra utilizes a hedging program to reduce the impact of market changes and price fluctuations, and 100% of its 2025 generation volume is hedged. This extensive hedging has helped to secure its first-quarter generation volumes.
Vistra’s operating costs and selling, general and administrative expenses have increased at a faster pace in 2024 compared with 2023 levels. The high expenses are expected to have continued in the first quarter of 2025 and must have offset some positive factors adversely impacting earnings per share.
VST’s Price Performance
VST’s shares have gained 70.9% in the past one year compared with the industry’s rally of 14.2%.
Image Source: Zacks Investment Research
VST Stock Trading at a Premium
Vistra is currently valued at a premium compared to its industry on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
Investment Thesis
Vistra is expanding its generation capacity through both organic growth and strategic acquisitions. Its integrated business model offers a key competitive edge over non-integrated peers. Contributions from recently acquired assets are also positively impacting the company’s performance.
Yet, operating nuclear power facilities carries substantial risks that could significantly affect Vistra’s revenues and financial results. Moreover, the company may not have sufficient insurance coverage to fully mitigate these risks and potential hazards.
Wrapping Up
Vistra operates in a region where demand for clean electricity is rising, and VST is increasing its clean energy generation capability through acquisition and organic means to serve customers and benefit from the same.
A stable hedging program and rising residential customer base add to VST’s benefit. As the stock is currently trading at a premium, it will be wise for new investors to wait a little longer and look for a better entry point after first-quarter earnings.
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VIstra is Set to Release Q1 Earnings: How to Play the Stock?
Vistra Corp. (VST - Free Report) is expected to deliver improvements in its top line and its earnings per share when it reports first-quarter 2025 results on May 7, before market open. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
The Zacks Consensus Estimate for VST’s first-quarter revenues is pegged at $4.4 billion, indicating an increase of 44.14% from the year-ago reported figure.
The Zacks Consensus Estimate for VST’s first-quarter earnings is pegged at 54 cents per share, indicating a 134.8% increase from the year-ago reported figure.
Image Source: Zacks Investment Research
Vistra’s Positive Earnings Surprise
Vistra surpassed earnings expectations in one of the last four quarters and missed thrice, with the average surprise being 42.41%.
Image Source: Zacks Investment Research
What the Zacks Model Unveils
Our model does not conclusively predict a likely earnings beat for Vistra this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you can see below.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Vistra has an Earnings ESP of 0.00%.
Zacks Rank: VST currently carries a Zacks Rank #3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Utilities like Fortis (FTS - Free Report) and MDU Resource Group (MDU - Free Report) have the right combination of factors to come out with earnings surprise this season. The Earnings ESP of Fortis and MDU Resources are currently pegged at +1.22% and +8.33%, respectively. MDU currently sports a Zacks Rank #1 and FTS has a Zacks Rank of 2.
Factors Likely to Have Shaped VST’s Q1 Earnings
Vistra's first-quarter earnings likely benefited from the rising demand for clean electricity within its service region. This growth in demand has been primarily driven by the expansion of large U.S. data centers and the electrification of the Permian Basin. VST’s diversified generation fleet, includes a high-quality nuclear fleet, which allows the company to capitalize on this accelerating load growth and benefit from the same.
VST’s first-quarter earnings is likely to have benefited from the commercial startup of solar and battery facilities at Coffeen and Bladwin, which added over 100 megawatt (MW) to the existing capacity of the company.
The repurchase of shares has been increasing shareholders' value and boosting earnings per share of the company, and is expected to have a positive impact on first-quarter earnings. The company executed $4.6 billion in share repurchases from November 2021 through Nov. 4, 2024, which lowered outstanding shares and boosted earnings per share. VST’s management expects to continue with the buyback of shares and aims to repurchase at least $2 billion worth of outstanding shares between 2025 and 2026, which will definitely have a positive impact on earnings.
Vistra utilizes a hedging program to reduce the impact of market changes and price fluctuations, and 100% of its 2025 generation volume is hedged. This extensive hedging has helped to secure its first-quarter generation volumes.
Vistra’s operating costs and selling, general and administrative expenses have increased at a faster pace in 2024 compared with 2023 levels. The high expenses are expected to have continued in the first quarter of 2025 and must have offset some positive factors adversely impacting earnings per share.
VST’s Price Performance
VST’s shares have gained 70.9% in the past one year compared with the industry’s rally of 14.2%.
Image Source: Zacks Investment Research
VST Stock Trading at a Premium
Vistra is currently valued at a premium compared to its industry on a forward 12-month P/E basis.
Image Source: Zacks Investment Research
Investment Thesis
Vistra is expanding its generation capacity through both organic growth and strategic acquisitions. Its integrated business model offers a key competitive edge over non-integrated peers. Contributions from recently acquired assets are also positively impacting the company’s performance.
Yet, operating nuclear power facilities carries substantial risks that could significantly affect Vistra’s revenues and financial results. Moreover, the company may not have sufficient insurance coverage to fully mitigate these risks and potential hazards.
Wrapping Up
Vistra operates in a region where demand for clean electricity is rising, and VST is increasing its clean energy generation capability through acquisition and organic means to serve customers and benefit from the same.
A stable hedging program and rising residential customer base add to VST’s benefit. As the stock is currently trading at a premium, it will be wise for new investors to wait a little longer and look for a better entry point after first-quarter earnings.