10 Best Stocks In Each Sector In 2024

5. Vistra Corp. (NYSE:VST)

Number of Hedge Fund Holders in Q2 2024: 93

Vistra Corp. (NYSE:VST) is a diversified electricity utility headquartered in Irving, Texas. The firm provides gas and electricity to consumers in several American states. Vistra Corp. (NYSE:VST) has a strong presence in the Texan energy market as it accounts for roughly one fifth of the state’s electricity consumption. Unlike several of the US’ sizeable electricity companies which often have to deal with regulators to set their ROE, Vistra Corp. (NYSE:VST) operates in unregulated markets which leaves the firm vulnerable to downswings in the industry if prices drop. Crucially though, the firm’s diversified power generation model that relies on clean energy sources like nuclear and others like coal can serve it well during the early phases of the AI data center build out. This is because data centers require continuous electricity, which solar and wind facilities cannot generate. Vistra Corp. (NYSE:VST) has also been making prescient acquisitions, with a nuclear asset purchase in 2023. This created a new entity, and the firm’s stock soared by 25% in September after it acquired the remaining interest in the entity. The reason behind the bullishness was clear as Wall Street and big tech are now increasingly focused on nuclear power for data centers and emissions reduction.

Meridian Funds mentioned Vistra Corp. (NYSE:VST) in its Q2 2024 investor letter. Here is what the fund said:

“Vistra Corp. (NYSE:VST) is an integrated retail electricity and power generation company with operations across 20 U.S. states and Washington D.C. We identified Vistra as a likely beneficiary of the projected growth of power-hungry data centers, spurred by the rise of generative AI, increasing electricity demand, and higher power prices. The stock performed well after the company delivered stronger than expected earnings. Management also provided forward guidance that exceeded investors’ expectations and reaffirmed shareholder-friendly plans for sizable share repurchases through 2025. We trimmed our position in the quarter following the strong performance and continue to see strong long-term prospects for the company.”