1. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Holders: 120
Topping our list of the Best Nuclear Energy Stocks is Vistra Corp. (NYSE:VST), a leading Fortune 500 integrated retail electricity and power generation company based in Texas. Vistra is the largest competitive power generator in the US with a capacity of approximately 41,000 megawatts, powered by a diverse portfolio that includes natural gas, coal, nuclear, solar, and battery energy storage facilities.
Vistra Corp. (NYSE:VST) reported a revenue of just over $4 billion in Q4 2024, up 31.16% YoY and above market estimates by $124 million. The company’s adjusted core profit from continuing operations during the quarter rose to $1.99 billion, compared to $965 million the previous year, as strong electricity demand from AI data centers helped boost its earnings. VST maintains a robust balance sheet, generating an operating cash flow of over $4.56 billion in 2024 and ending the year with $1.2 billion in cash on hand. While its $16 billion debt load is significant, its robust cash flow should comfortably cover debt obligations while allowing for strategic reinvestment. Moreover, the company expects to return at least $2 billion in total through share repurchases in 2025 and 2026, which includes the additional $1 billion share repurchase authorization announced in Q3 2024.
Vistra Corp. (NYSE:VST) revealed that it has begun construction at its sites in Oak Hill, TX, in support of its contract with Amazon, and Pulaski, IL, for a contract with Microsoft. Once online, these facilities will add over 600 megawatts of renewable capacity to its portfolio.
Meridian Funds stated the following regarding Vistra Corp. (NYSE:VST) in its Q4 2024 investor letter:
“Vistra Corp. (NYSE:VST) is an integrated retail and power generation company with operations across the U.S., primarily serving Texas and the Midwest. We believe Vistra is well-positioned to capitalize on the structural tightening of power markets, as electricity demand accelerates, and baseload generation capacity continues to retire. This trend has been amplified by the rapid growth of AI, which is driving unprecedented demand for data centers and the power required to run them. These factors create a favorable pricing environment for Vistra’s generation fleet, especially its nuclear and gas assets. The company has locked in much of this value via hedging, providing clear visibility into future cash flows. Vistra has also successfully grown its retail business and completed a strategic acquisition of Energy Harbor, which added a portfolio of nuclear, retail, and renewable assets.”
Overall, Vistra Corp. (NYSE:VST) ranks first on our list of the best nuclear power stocks to buy now. While we acknowledge the potential for VST to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than VST but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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